Page 97 - ENTREPRENEURSHIP Innovation and entrepreneurship

53231_Innovation and Entrepreneurship.qxd 11/8/2002 10:50 AM Page 90

90 THE PRACTICE OF INNOVATION

have immediate impacts on society and economy. But otherwise, demo-
graphic changes were “secular” changes, of interest to the historian and
the statistician rather than to the businessman or the administrator.
This was always a dangerous error. The massive nineteenth-cen-
tury migration from Europe to the Americas, both North and South,
and to Australia and New Zealand, changed the economic and politi-
cal geography of the world beyond recognition. It created an abun-
dance of entrepreneurial opportunities. It made obsolete the geopolit-
ical concepts on which European politics and military strategies had
been based for several centuries. Yet it took place in a mere fifty years,
from the mid-1860s to 1914. Whoever disregarded it was likely to be
left behind, and fast.
Until 1860, for instance, the House of Rothschild was the world’s
dominant financial power. The Rothschilds failed, however, to rec-
ognize the meaning of the transatlantic migration; only “riff-raff,”
they thought, would leave Europe. As a result, the Rothschilds
ceased to be important around 1870. They had become merely rich
individuals. It was J. P. Morgan who took over. His “secret” was to
spot the transatlantic migration at its very onset, to understand
immediately its significance, and to exploit it as an opportunity by
establishing a worldwide bank in New York rather than in Europe,
and as the medium for financing the American industries that immi-
grant labor was making possible. It also took only thirty years, from
1830 to 1860, to transform both western Europe and the eastern
United States from rural and farm-based societies into industry-dom-
inated big-city civilizations.
Demographic changes tended to be just as fast, just as abrupt, and
to have fully as much impact, in earlier times. The belief that popula-
tions changed slowly in times past is pure myth. Or rather, static pop-
ulations staying in one place for long periods of time have been the
exception historically rather than the rule.*
In the twentieth century it is sheer folly to disregard demographics.
The basic assumption for our time must be that populations are inher-
ently unstable and subject to sudden sharp changes—and that they are
the first environmental factor that a decision maker, whether business-
man or politician, analyzes and thinks through. Few issues in this cen-
tury, for instance, will be as critical to both domestic and international
politics as the aging of the population in the developed countries on the

Here the work of the modern French historians of civilization is definitive.