I think a stronger argument in favour of capitalism is that inventions such as the fridge and the washing machine were much less likely to be conceived
Don't dig youreself a pit with that argument, obviously there's millions of years left for invention, you have to recognise that even for youre argument it would need to be seen as a function of time, aka can we have technoligy faster than otherwise.
And furthermore there is an inverse to it. Never did technoligy develop as fast during world wars, but it's hard to argue that faster innovation would be worth a world war. So as a guiding value technological progress still has a relative worth?
The profit motive has advanced human progress more as any other factor, other than perhaps warfare.
I think it's crucial to ask if we can't change the "profit" part here with "compensation". Increased compensation can motivate too, but is more strictly limited than profit.
What this boils down really is the question: "do you need capitalism to be able to create innovation trough competition"?
As a product developer i'd say there is few innovation actually provided by the managers rather than the actual engineers in that field, and yes the project leader gets a larger compensation. Still quite different than to launch youre product based on youre own design trough youre own company to then be able to potentially make rediculous profits. In fact its rather hard to go too complex as a starting entrepeneur given potential investment requirements, most significant technoligy gets developed under larger firms often even subsidised by the state only illustrating the more relevant capital requirements of it. Smaller entrepeneurs often more target such things like consumerist fad's, much innovation that.
If the state would need to organise the innovation then fine it would need to have some competing teams for their grants. Afaik when it regards the spending of the US DoD a lot of it goes to internal research projects and that provides a lot of cutting edge technoligy.
