Production technology and management in planned and market economies

This paper discusses how technological innovation takes place in manufacturing industry, and especially in the engineering sector, contrasting in particular the effects of the Western market economy, and the East European planned economy. The relative lack of cross-influence between formal scientific research and actual industrial innovation practice in this area is first discussed. Comparative studies of engineering practice in planned and market economies are described which point to the important influence of the economic environment on innovation practice in the factory's design office, and on the shop-floor. The East European Soviet Type Economy is seen to have features which in the light of recent Western empirical studies into industrial innovation, must hamper this process. In particular it is proposed that its relative economic and social rigidity has an important restricting influence on the actual process of innovation in the factory.