The Anti-Techonomic View: Economic Growth Is Over

The Techonomic view of how continued rapid technological innovation will transform society and industries is expressed on these pages every day. MIT economist Erik Brynjolfsson is among those who say “our best days are still ahead of us.” Northwestern macroeconomist Robert Gordon might be the anti-Techonomist.

The techonomic view of how continued rapid technological innovation will transform society and industries is expressed on these pages every day. The difference between this optimistic perspective and the contrary one was encapsulated in a debate at our 2011 conference between economists Erik Brynjolfsson (“our best days are still ahead of us”) and Tyler Cowen (we’re seeing “not enough growth and not enough progress”).

Among the contrarians is macroeconomist Robert Gordon. In New York Magazine this week, Benjamin Wallace-Wells explains Gordon’s gloomy forecast for the U.S. economy. It takes more than 4,000 words, but the gist: Growth is over. Born in 1940, the Northwestern University professor believes Americans’ most dramatic advances in wealth and living standards are not yet to come; they happened during his lifetime, and nothing like them will happen again.

Wallace-Wells writes, “the examples of the Internet, and perhaps artificial intelligence, suggest that progress continues to be rapid.” But Gordon, he explains, sees those as mere social transformations. He looks at their impact on the average American family’s wealth, education, and health in the context of the first and second industrial revolutions. Which means he is not impressed. The pace of Moore’s Law isn’t speedy enough to be heralding anything like a third revolution.

Wallace-Wells concedes that the scope of Gordon’s bleakness makes him “bleaker than everyone else.” He translates:

“The global economic slump that we have endured since 2008 might not merely be the consequence of the burst housing bubble, or financial entanglement and overreach, or the coming generational trauma of the retiring baby boomers, but instead a glimpse at a far broader change, the slow expiration of a historically singular event. Perhaps our fitful post-crisis recovery is no aberration.”

The consequences of the second industrial revolution, Wallace-Wells notes, “took a century to be fully realized, and … they came to rearrange social forces and transform everyday lives.”

It’s hard to imagine that 100 years from now the consequences of the Internet, artificial intelligence, robotics, 3D printing, and genomic technology won’t easily have done it all over again. But maybe Gordon is just not thinking that far ahead.

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