Nation of Beancounters

Good rebuttals

Posted in Innovation by Navin Kumar on December 3, 2012

Argument: Pharmaceutical companies do not innovate.

Proof: Expenditure on marketing is larger than expenditure on R&D

Rebuttal:

Apple spends more on marketing than on R&D but this doesn’t make Apple any less innovative … if the marketing budget were cut, revenues would fall. Marketing drives sales and (expected) sales drives R&D. [A person arguing this line] is like the financial expert who recommends that a family save money by selling its car forgetting that without a car it makes it much harder to get to work.

That’s Alex Tabarrok in fine form. Rest here.

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