Financialization's negative effect on the American solar industry

March 29, 2017

Financialization's Negative Effect on the American Solar Industry: The increasing role of the United States' financial sector in the 1980s and 1990s, when it shifted from focusing on technology investment to speculating on future markets, impaired the country's emerging solar industry, a new study reports. In Japan, by contrast, photovoltaics manufacturers were insulated from such financial turbulence and continued to expand investment in solar manufacturing, achieving nearly 50% of the global market share by 2005, by which time U.S. market share had dwindled to about 9%. At a time when it is critical to understand how to best define carbon mitigation strategies, this case study helps assess whether such efforts are obstructed by financialization, highlighting the conflicting relationship between finance and production, at least in this case. Max Jerneck chronicled the history of Japan and the U.S. beginning in the 1960s when NASA first developed solar cells to convert sunlight into electricity. As American conglomerates purchased small firms pioneering solar technology, less money was orientated toward investing in improving the technology and instead directed toward enriching managers and investors. This led to a disconnect between industry and finance and eventually resulted in dismantling or selling the solar divisions of many conglomerates. As a result, between 1978 and 2005 the American share of the global solar market dropped from 95% to about 9%. In contrast, Japan, with an economy roughly half the size of the U.S., has fostered a solar market now several times larger. The country's entrance into the solar industry began with a strong hold on semiconductor and electronics markets and progressed without corporate governance takeover, leading to nearly a 50% global share of the industry in 2005. These case studies cast doubt on the success of carbon pricing in the U.S., Jerneck says; while a carbon tax could make low carbon industries more competitive, many will undoubtedly fail as innovation is always uncertain. Instead, the paper calls for policies that bring productive and financial capital together.

American Association for the Advancement of Science

Related Technology Articles from Brightsurf:

December issue SLAS Technology features 'advances in technology to address COVID-19'
The December issue of SLAS Technology is a special collection featuring the cover article, ''Advances in Technology to Address COVID-19'' by editors Edward Kai-Hua Chow, Ph.D., (National University of Singapore), Pak Kin Wong, Ph.D., (The Pennsylvania State University, PA, USA) and Xianting Ding, Ph.D., (Shanghai Jiao Tong University, Shanghai, China).

October issue SLAS Technology now available
The October issue of SLAS Technology features the cover article, 'Role of Digital Microfl-uidics in Enabling Access to Laboratory Automation and Making Biology Programmable' by Varun B.

Robot technology for everyone or only for the average person?
Robot technology is being used more and more in health rehabilitation and in working life.

Novel biomarker technology for cancer diagnostics
A new way of identifying cancer biomarkers has been developed by researchers at Lund University in Sweden.

Technology innovation for neurology
TU Graz researcher Francesco Greco has developed ultra-light tattoo electrodes that are hardly noticeable on the skin and make long-term measurements of brain activity cheaper and easier.

April's SLAS Technology is now available
April's Edition of SLAS Technology Features Cover Article, 'CURATE.AI: Optimizing Personalized Medicine with Artificial Intelligence'.

Technology in higher education: learning with it instead of from it
Technology has shifted the way that professors teach students in higher education.

Post-lithium technology
Next-generation batteries will probably see the replacement of lithium ions by more abundant and environmentally benign alkali metal or multivalent ions.

Rethinking the role of technology in the classroom
Introducing tablets and laptops to the classroom has certain educational virtues, according to Annahita Ball, an assistant professor in the University at Buffalo School of Social Work, but her research suggests that tech has its limitations as well.

The science and technology of FAST
The Five hundred-meter Aperture Spherical radio Telescope (FAST), located in a radio quiet zone, with the targets (e.g., radio pulsars and neutron stars, galactic and extragalactic 21-cm HI emission).

Read More: Technology News and Technology Current Events is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to