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Rereading Marx to find the relevance of the factory today

“The knowledge economy was born in the factory”,writes Joel Mokyr, one of the leading experts on the industrial economy, in his book “The Gifts of Athena – Historical Origins of the Knowledge Economy”, published by Princeton University Press in 2002. In this assessment, we see the lessons of Max Weber and of Alfred Marshall, who said that molecular, cumulative and adaptive change comes out of our production systems. Going even further back, there is the lesson of Karl Marx in Das Kapital, where he speaks of the “incoercible vitality of productive forces” and describes the constant, cumulative production of knowledge incorporated and generated within the factory, while insisting that, beyond a certain threshold of development, the factory is, above all, technology and knowledge.

Thus, we see the factory as a place of innovation, of the formation of a new culture, of the production of goods and services, but also of a system of relationships that brings together different types of knowledge—from science and technology to the humanities—that are essential to creating systems of guidance and governance for the people who work there and to constructing the language needed to describe the work being done, the products being made, and the markets in which they are sold and consumed. We see it as a place in which technology meets ethics (coming back to Weber) and, yes, even where it meets the aesthetics of the products and of the attractive, sustainable factories themselves, designed by great architects and featuring layouts and ergonomics intended to inspire each and every individual who works there as they enjoy both the exterior landscapes and the warmth and light of the interior.  Here, too, we could apply the slogan “Enterprise is culture” – a “polytechnic culture”, of course.

The work of Mokyr has also inspired the seminar “Nuove fabbriche – Lo sviluppo industriale a un tornante” (New factories – Industrial development at a switchback), which was held last week in Turin in the former factories in Corso Castelfidardo that are now home to Politecnico di Milano, organised by Bocconi University and by Istituto Superiore sui Sistemi Territoriali per l’Innovazione (SITI) and led by Giuseppe Berta, a talented industrial historian (whose new book, “La produzione intelligente” (Intelligent production), inspired by the evolution of Italy’s industrial system, is to be published by Einaudi in February).

But does it still make sense today to talk about factories when Italian industry appears to be slipping backwards (setting 2008 production at a base index of 100, in December 2012 the number falls to 76 and is continuing to slip in a process that is destroying businesses and eroding jobs and skills)? Yes, it does if we look beyond the symptoms of decline of the “great factories” that made Italy what it was in the 20th century to see the dynamism of a collection of small and medium-sized businesses that are, particularly in northern Italy, managing to grow, to innovate, to combat the crisis by focusing on international markets, and to show a new, Italian brand of vitality.

Berta speaks of competitiveness based on quality and on “high-end” products and explains that, even in the fabric of Italian production, along side the decay of the old-school production apparatus, we are beginning to see a more sophisticated—if still uncoordinated—convergence of numerous enterprises in a range of industries and areas of the economy that are seeking to reclassify their businesses, both to maintain their ties to the territory and to increase their ability to export and to compete abroad.

These factories are experimenting with new relationships between product and service (while helping to bring innovation to a service sector in Italy that remains highly traditional and not particularly competitive), backed by world-leading human capital and Italy’s robust “knowledge economy”, and they are driving development in a direction that makes the EU target (reiterated by Italian Prime Minister Letta) of bringing manufacturing up to 20% of GDP by 2020 more realistic (now we are at just under 17%).

There is one more thing that brings us to insist on the relevance of the factory. “Manufacturing is a sort of stronghold of Italian rational organisation, whereas the same cannot be said for government, for many public services, or for the world of sports,” said Dario Di Vico, a journalist with a great deal of experience and knowledge of Italy’s economy. Industrial rationalism, instilled with creativity and a strong propensity for growth, meaning that the battle for development has not, despite it all, been lost.