Final answer:
Technological inertia is the reluctance of organizations to adopt new technologies without clear benefits. Governments may intervene to facilitate adaptation through training and R&D support, rather than blocking progress. Efficient technology adoption, backed by institutional training, drives productivity growth and is viewed as necessary despite disruptions.
Step-by-step explanation:
The notion that organizations will not adopt new technology unless they see tangible benefits is referred to as technological inertia. Technological inertia describes a scenario in which the perceived risks, costs, or disruptions of adopting a new technology outweigh the anticipated gains. Consequently, businesses may be reluctant to integrate advanced technologies unless they can clearly discern a direct, tangible benefit such as cost reduction, increased productivity, or competitive advantage.
As illustrated in the case of a hypothetical company, Technotron, the advent of a new technology can result in significant economic disruption, causing competing firms to lose money or go bankrupt. It raises the question of whether the government should protect existing firms at the expense of innovative developments. In practice, government involvement often involves supporting programs geared towards worker retraining, skill acquisition, and support for research and development, but not necessarily blocking technological progress outright. These governmental supports help to mitigate the adverse effects of technological displacement whilst ensuring that the overall benefits of technological advancement, which can include improved goods and services, are realized.
It can be argued that government investment in new technology is necessary to ensure that the workforce and other firms can adapt to and keep pace with technological changes. Productivity growth is spurred on by quick and efficient adoption of new technologies, often supported by powerful training and development institutions. Such investment enhances the broader economic environment, making it conducive to ongoing innovation and progress. Ultimately, most market-oriented societies view technological change and its disruptions as a necessary evolution rather than a hinderance.