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Cultural and Institutional Differences Between Europe and U.S. Keep Europe from Having a Silicon Valley



(p. B7) "They all want a Silicon Valley," Jacob Kirkegaard, a Danish economist and senior fellow at the Peterson Institute for International Economics, told me this week. "But none of them can match the scale and focus on the new and truly innovative technologies you have in the United States. Europe and the rest of the world are playing catch-up, to the great frustration of policy makers there."

Petra Moser, assistant professor of economics at Stanford and its Europe Center, who was born in Germany, agreed that "Europeans are worried."

"They're trying to recreate Silicon Valley in places like Munich, so far with little success," she said. "The institutional and cultural differences are still too great."


. . .


There is . . . little or no stigma in Silicon Valley to being fired; Steve Jobs himself was forced out of Apple. "American companies allow their employees to leave and try something else," Professor Moser said. "Then, if it works, great, the mother company acquires the start-up. If it doesn't, they hire them back. It's a great system. It allows people to experiment and try things. In Germany, you can't do that. People would hold it against you. They'd see it as disloyal. It's a very different ethic."

Europeans are also much less receptive to the kind of truly disruptive innovation represented by a Google or a Facebook, Mr. Kirkegaard said.

He cited the example of Uber, the ride-hailing service that despite its German-sounding name is a thoroughly American upstart. Uber has been greeted in Europe like the arrival of a virus, and its reception says a lot about the power of incumbent taxi operators.

"But it goes deeper than that," Mr. Kirkegaard said. "New Yorkers don't get all nostalgic about yellow cabs. In London, the black cab is seen as something that makes London what it is. People like it that way. Americans tend to act in a more rational and less emotional way about the goods and services they consume, because it's not tied up with their national and regional identities."


. . .


With its emphasis on early testing and sorting, the educational system in Europe tends to be very rigid. "If you don't do well at age 18, you're out," Professor Moser said. "That cuts out a lot of people who could do better but never get the chance. The person who does best at a test of rote memorization at age 17 may not be innovative at 23." She added that many of Europe's most enterprising students go to the United States to study and end up staying.

She is currently doing research into creativity. "The American education system is much more forgiving," Professor Moser said. "Students can catch up and go on to excel."

Even the vaunted European child-rearing, she believes, is too prescriptive. While she concedes there is as yet no hard scientific evidence to support her thesis, "European children may be better behaved, but American children may end up being more free to explore new things."



For the full story, see:

JAMES B. STEWART. "Common Sense; A Fearless Culture Fuels Tech." The New York Times (Fri., JUNE 19, 2015): B1 & B7.

(Note: ellipses added.)

(Note: the online version of the story has the date JUNE 18, 2015, and has the title "Common Sense; A Fearless Culture Fuels U.S. Tech Giants.")







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