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Great inventions rarely pay inventors
Inventors left poor
The smartest physicist of the 20th century came up with general relativity and did not become a billionaire, or even a millionaire. Railroads were enormously valuable, and most of them went bankrupt because of too much competition. The Wright brothers flew the first plane and made no money.
The textile mills
The first Industrial Revolution ran on textile mills. From 1780 to 1850, with the steam engine and automation, efficiency in textile factories and manufacturing improved at 5 to 7% a year, decade after decade. Even so, in 1850 most of the wealth in Britain was still held by the landed aristocracy. Workers did not make much, and neither did the capitalists, because hundreds of people ran textile factories and the competition kept anyone from profiting.
The just-universe belief
Across 250 years of technological progress, the share of value captured has been almost always zero in science and very close to it in technology. Scientists tend to believe they live in a just universe that will reward them for their work and their inventions, and the history of science shows that belief to be a delusion.
Why did railroads go bankrupt despite their value?
Railroads carry enormous fixed costs for track, stations, and locomotives, and those costs must be paid whether or not trains are full. When competing lines served the same routes, they cut rates to win freight, often below what it cost to run the trains. After the Panic of 1893, railroads covering about a quarter of US track mileage went into receivership.
Why did the Wright brothers fight over patents?
The Wrights won a US patent in 1906 covering their method of controlling an airplane in flight. They sued other aviators and manufacturers, and the court fights dragged on for years. In 1917 the US government pressed manufacturers to form a patent pool, the Manufacturers Aircraft Association, to end the dispute as the nation prepared for war.
How did machines transform textile output so fast?
James Hargreaves's spinning jenny, from the 1760s, let one worker spin several threads at once. Richard Arkwright's water frame used water power to spin stronger thread in mills. Edmund Cartwright patented a power loom in 1785, and steam engines later freed mills from riverbanks. Cotton cloth became one of Britain's largest exports in the early 1800s.
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