Is Technological Progress a Thing of the Past?

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• Is Technological Progress a Thing of the Past?
• Joel Mokyr
• Departments of Economics and History
• Northwestern University
• Berglas School of Economics
• Tel Aviv University

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• Economics, sometimes known for being the dismal
  science has always had its share of alarmist and
  scary predictions of stagnation and economic
  decline.
• Among the many scenarios suggested in the past
• Overpopulation and Malthusian disasters
• Population aging and fertility decline
• Resource exhaustion
• The welfare state is unsustainable
• Structural lack of aggregate demand (secular
  stagnation)
• Environmental disasters such as climate change

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• Most recently the question that has been raised
  is can we keep up the technological momentum
  that has so dramatically changed our lives since
  1850 or so?

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A new wave of techno-pessimism is upon us

• The new technopessimist interpretation (for
  instance Robert Gordon) says that the low-hanging
  fruits of invention have all been picked.
• Future inventions, we are told, will not have
  nearly as radical an effect as before.
• For that reason, innovation will not be powerful
  enough to counter other economic headwinds and
  annual GDP growth will slow down to a trickle.

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Innovation pessimismHas the ideas machine broken
down?
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Gordon is not alone

• Many feel disappointed. Peter Thiel (of Paypal
  fame) has famously remarked we wanted flying
  cars, instead we got 140 characters.
• To which I would reply wait till you need a hip
  replacement, buddy.

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Is the world running out of ideas?

• Perhaps the low-hanging fruits that have changed
  our lives have been picked running water,
  chlorination, electricity, air conditioning,
  antibiotics etc?
• But science and technologys main function in
  history is to make taller and taller ladders to
  get to the higher-hanging fruits (and to plant
  new and maybe improved trees).
• Moreover, the old trees will keep sprouting new
  fruits, if only we give them proper care.

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Of course, some other people are hyperoptimists

• They argue that the rapid improvements in
  computation and artificial intelligence (AI) have
  the potential to increase its productivity and
  breadth to the extent that human labor and
  intelligence will become increasingly
  superfluous.
• This is what is known as singularity associated
  with such futurist as Ray Kurzweil in which
  machines not only replicate themselves but
  actually are capable of what is known as
  recursive self-improvement.

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Ray Kurzweil, computer scientist, inventor and
futurist
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• The productivity of computers and software has
  grown at phenomenal rates for more than a
  half-century, and rapid growth has continued up
  to the present. Developments in machine learning
  and artificial intelligence are taking on an
  increasing number of human tasks, moving from
  calculations to search to speech recognition,
  psycho-therapy, and robotic activities on the
  road and battlefield. At the present growth of
  computational capabilities, some have argued,
  information technologies will have the skills and
  intelligence of the human brain itself
  (Nordhaus, 2015).

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• Quite a few people think that this is a dystopian
  prediction and could be even worse than secular
  stagnation.
• But economists of course know that it is not at
  all clear that singularity is likely computer
  intelligence and human intelligence are good at
  quite different things and may be more
  complements than substitutes, that is, they will
  work together rather than replace each other.
• My view is that computers, rather than becoming
  our masters, will help us understand and dominate
  nature better.
• I will come back to this point.

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So the Big Question is Quo Vadis, Technology

• What can an economic historian bring to this
  discussion?
• Here is the take-home line
• If the patterns of the past hold (a big if),
  there is good reason to expect the rate of
  technological change to accelerate over the next
  decades, although it would be foolhardy to be
  more specific than that (and even more to try to
  predict the rate of productivity growth or
  whether we are facing a Kurzweilian singularity).

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At least to give us some perspective to
appreciate Amaras Law

• We tend to overestimate the effect of a
• new technology in the short run
• and underestimate the effect in the long run.
• Roy Amara,
• Past president of
• The Institute for the Future.

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Can growth continue?

• The world is running into headwinds that are
  supposed to slow the industrial economies down to
  a trickle. A few of those seem at first glance to
  be ineluctable.
• Population ageing
• Declining employment and L-force participation.
• National indebtedness
• Education running into diminishing returns.
• Environmental problems and climate change.
• note many of those things are only bad if
  your objective is to maximize GDP as currently
  defined

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But against that, I argue

• The tailwind from technology is likely to be so
  powerful that, like a tornado, it will overcome
  all headwinds from other factors.
• Can I be sure? No.
• Can we learn anything from history here?
• The best I can do is point to four factors that I
  think made a difference in the past, and then
  argue that they are much stronger today than ever
  before.

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Four factors that mattered in the past

• Pluralism and Diversity
• Artificial Revelation
• Access costs
• Good incentives for intellectual innovation and a
  well-defined agenda.
• So my plan is show their historical importance,
  and then argue that they hold for todays world a
  fortiori.

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• Factor one pluralism and competition

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Why do Diversity and Pluralism matter?

• There are two ways to think about it.
• One is the evolutionary notion that creativity is
  the result of diversity, because progress occurs
  through a process of selection, and as we have
  known ever since Darwin, the more items there are
  to select from on the cultural menu, the more
  likely it is that fitter varieties will occur.
• The other is the economic model of competition
  that says that in a world in which many entities
  compete hard, progress is more likely to occur
  because no competitor wants to fall behind (and
  those who do, drop out).

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• These two stories are not mutually exclusive and
  in fact both shed some light on why economic
  growth and technological progress started in the
  Western World around 1750 with the Industrial
  Revolution.
• This is the topic of my new book, A Culture of
  Growth Origins of the Modern Economy (Princeton
  Princeton University Press, forthcoming, 2016).

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According to that story, the political
fragmentation and the religious and cultural
pluralism of Europe was a key to its success.

• This was, interestingly enough, fully realized by
  philosophers of the Age of Enlightenment

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• Europe is now divided into twelve powerful,
  though unequal, kingdoms, three respectable
  commonwealths, and a variety of smaller, though
  independent, states the chances of royal and
  ministerial talents are multiplied, at least,
  with the number of its rulers . . . The abuses of
  tyranny are restrained by the mutual influence of
  fear and shame republics have acquired order and
  stability monarchies have imbibed the principles
  of freedom, or, at least, of moderation and some
  sense of honour and justice is introduced into
  the most defective constitutions by the general
  manners of the times. In peace, the progress of
  knowledge and industry is accelerated by the
  emulation of so many active rivals in war, the
  European forces are exercised by temperate and
  undecisive contests." (Gibbon, 1789, V.3, p.636)

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• Here on the same topic is the greatest of all
  Enlightenment writers

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• Nothing is more favorable to the rise of
  politeness and learning than a number of
  neighbouring and independent states, connected
  together by commerce and policy. The emulation,
  which naturally arises among those... is an
  obvious source of improvement. But which I would
  chiefly insist on is the stop constraint which
  such limited territories give both to power and
  authority... The divisions into small states are
  favourable to learning, by stopping the progress
  of authority as well as that of power.
• David Hume (1742)

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Modern economics agrees

• We know that the competitive model is a good
  approximation for the behavior of political
  entities in the seventeenth and eighteenth
  centuries the time, which encouraged and even
  supported scientific and technological advances,
  not out of altruism but to keep ahead (or at
  least to keep up).
• Moreover, fierce competition took place not only
  between nations but also within them, for example
  between different religious groups or between
  cities and regions.

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The evolutionary model suggests the same

• In Europe of the sixteenth and seventeenth
  century a lot of new cultural varieties began
  to emerge and increased the size of the menu
  from which people could choose.
• Two examples in medicine, the old humoral
  theory inherited from the Greeks and Arabs of
  disease now had to compete with the
  iatrochemical school founded by the great Swiss
  physician Paracelsus.
• In physics, Cartesianism competed with
  Newtonianism in the late seventeenth and
  eighteenth centuries, and the atomic theory
  (known as corpuscularianism) competed with
  vitalism and both competed with
  Aristotelianism.

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What made this market so competitive is
well-understood

• The invention of the printing press, the growth
  of epistolary networks, and the growth and
  proliferation of universities and non-academic
  institutions of learning such as the Accademia
  dei Lincei and the Académie Royale.
• These were happening in a world in which courts
  and universities of many kingdoms, cities and
  principalities were competing to attract the best
  and the brightest.
• But the scholars and intellectuals also competed
  with one another for the best patronage
  positions.

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As the Talmud says The jealousy of learned
men will increase wisdom
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What emerged from all this was a new world.

• It led to breakthroughs in science and
  technology, and eventually to the Industrial
  Revolution and modern economic growth which were
  driven by them.

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So what does this model predict for today?

• The world is more pluralistic and competitive
  than ever. Globalization does NOT imply that
  competition between 5-6 major blocks is not as
  intense as it was in the seventeenth century (but
  it is to be hoped that it will not end the same
  way in a series of destructive wars).
• All participants realize that unless they keep up
  with best-practice science and technology, they
  will fall hopelessly behind in the global
  competition.

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One obvious reason is that globalization is far
from creating a homogeneous world.

• Different cultures create different forms of
  innovation. Globalization means that all players
  are exposed to and have access to these options
  subsequently.
• So we have American genetic modification, German
  chemistry, Israeli software, and Chinese advances
  in acupuncture and moxibustion, among many
  others.
• But todays world is different in one respect if
  an invention is made somewhere, it is made
  everywhere. Diffusion is immediate.

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• Factor 2 Artificial Revelation

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Artificial Revelation

• What drives scientific advances at any time? They
  are driven by many factors, but one of the most
  important is the tools and instruments available
  to scientists.
• Thus technological progress stimulates and helps
  scientific advances no less than the reverse.

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Why is this so important?

• Simply, because our senses and brains are too
  limited for much of nature, which operates at
  scale, frequencies, distances, and bandwidths
  that we cannot observe. We only observe them
  through artificial revelation.
• Moreover, many important phenomena are also too
  complex to compute by hand.
• So we need tools.

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• This was certainly true for the scientific
  revolution in the 17th Century.
• The best-known examples are of course the great
  trio of the telescope, the microscope, and the
  barometer, all developed during the early
  seventeenth-century. These three instruments
  played a big role in the Scientific Revolution.
  But there are many others.
• Let me give you a few lesser-known examples from
  the era before and during the Industrial
  Revolution to drive the point home.

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Boyles famous air pump
Robert Boyles famous air pump, built in the late
1650s, which showed once and for all that contra
Aristotle, nature did not abhor a vacuum, and
thus paved the road for atmospheric (steam)
engines.
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• Voltas pile (1800)

Voltas battery provided chemists with a new
tool, electrolysis, pioneered by Humphry Davy. He
and other chemists were able to isolate element
after element, and fill in much of the detail in
the maps whose rough contours had been sketched
by Lavoisier and Dalton.
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And in medicine
Joseph J. Lister (father of the famous surgeon),
inventor of the achromatic microscope that
minimized both chromatic and spherical
aberration. This made it possible eventually for
Pasteur, Koch and others to demon- strate that
infectious diseases were directly linked to
identifiable microorganisms.
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Better tools make for better science

• This, to, is true a fortiori in our age.
• Sciences toolkit has grown enormously in the
  past decades.
• This expansion cannot but lead to rapid
  applications, in fields that are at times obvious
  and immediate but often unexpected.
• Examples are easy to come by.
• Start with telescopy, in honor of Galileo

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Galileo never had this

• Artists impression of the European Extremely
  Large Telescope deploying lasers for adaptive
  optics

Future of Work
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Here is what is can do
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Adaptive optics

1. These are two images of the planet Uranus, one
   using an ordinary telescope, the other one in
   which the blurring caused by atmospheric
   distortions are corrected through adaptive
   optics.
2. Adaptive optics technology sharpens images by
   changing the shape of telescope mirrors up to
   1,000 times per second.
3. It is believed to have more potential than
   Hubbles telescope (and is a lot less expensive).
   

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Neither did Pasteur have this
Betzig-Hell type of stimulated emission
depletion (STED) microscope
Future of Work
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Another example how new technology helps science
Automatic gene sequencing machines, first
developed in 1986 by Dr. Leroy Hoods laboratory
at CalTech, critical in sequencing of genome.
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And perhaps the most revolutionary
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And Now CRISPR
Jennifer Doudna
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1. CRISPR basically works a bit like the
   find-and-replace function in word-processing.
   It may, within a generation, rid us of all 6,000
   genetic diseases, from common one like Tai-Sachs
   and sickle-cell anemia, to rare diseases such as
   San Filippo syndrome.
2. But it can be used to knock out genes or sets of
   genes quickly and cheaply, and thus allow
   scientists to study disease that depend on sets
   of genes such as diabetes and autism.
3. Its capabilities in redesigning organisms maybe
   unlimited.

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• Even more impressive it allows scientists to
  manipulate germ-line cells, and thus have the new
  genetic configuration passed on in perpetuity.
• This has raised a lot of debate among
  bio-ethicists. A concern that scientists could
  create supermen is only one of those.
• But even we ban this technique in humans, we
  could apply it to all other creatures and create
  plants and animals according to the
  specifications we want --- including for instance
  their ability to withstand the vicissitudes of
  climate change and growing water scarcity.

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Finally, of course, the computer

• It is hard to think of a single field of research
  that has not been transformed by computers.
• The real question often seems to be what did we
  ever do before it?
• My interest here is not in what the digital
  revolution does for productivity directly, but
  rather indirectly through its effect on science.

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Computers allow research hitherto impossible

• In Chemistry Multiscale Models of Complex
  Chemical Systems, which allows the solution of
  the complex equations that govern the properties
  of quantum chemistry.
• In Physics allow the simulation of complex
  differential equations (Navier-Stokes) that are
  known to govern turbulence but cannot be solved.
• In Material science We now can simulate the
  equations that define the properties of materials
  using high-throughput super-computers to
  experiment with materials having pre-specified
  properties in silico.

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• The new science then feeds back into
  technology, at times with enormous power.
• In this way, technology (instruments) and science
  mutually reinforce one another in a positive
  feedback loop.
• Or, another way to look at it technology pulls
  itself up by its bootstraps through the
  intermediation of science.

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Why does this matter?

• Much of the discussion about the coming of the
  future of the digital revolution is about its
  direct impact on consumption and production
• Will we have robots making us coffee, driving
  trucks, pick our tomatoes and babysit our
  infants? Will Artificial Intelligence teach our
  students and program our lives??

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• But that forgets the important indirect effect
• IT ? Science ? other technologies

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Here is an example (from French expo 2015
pavilion)

• The use of digital technology to assist
  evolutionary selection high-throughput
  phenotyping platforms, equipped with robots and
  cameras, which enable them to detect plant genes
  that are better adapted to human and environment
  needs. These platforms can characterize and sort
  1000s of individual plants through automated
  means and on a daily basis.
• This maybe a partial substitute for genetic
  modification, since it relies only on natural
  mutations.

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• Factor 3 Access Costs

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• Some very important pieces of knowledge that are
  known to society are only possessed by few smart
  individuals.
• And hence, access by others who do not have this
  knowledge but need it is important. Such access
  is costly.

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Why is access so crucial to sustained
technological dynamism?

• Part of it that more and more invention requires
  access to the best science available in material
  science, biochemistry, combustion, etc.
• Even if science is not directly very useful in
  guiding an inventor, it is still true that
  Fortune favors the prepared mind.
• But it is also true that technology advances by
  ideas having sex as one writer famously
  described it. So if you have one idea, you need
  access to a partner.
• Finally, inventors have to know what is already
  known, so that they dont reinvent more wheels
  than is unavoidable.

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This does not matter as long as users who need
this knowledge have access to it.

• But access can be costly. What determines access
  costs?
• Among many factors, clearly the technology of
  storing codified information and searching
  through it figure highly.
• In the past, the most important advances in
  information-storage and search-engine technology
  were the invention of writing, paper and the
  printing press.

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• But knowledge needs to be organized if access is
  to be fast and cheap and searches are to be
  efficient.
• The Age of Enlightenment that preceded the
  Industrial Revolution blazed new trails in access
  capability in technology and in science, both for
  codified and tacit knowledge.

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• The eighteenth century version of the search
  engine was the encyclopedia. Alphabetized
  encyclopedias and indices to technical books were
  the Googles of their age.
• And indeed, the paradigmatic enlightenment
  document is Diderots Grande Encyclopédie.

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• Pinmaking essay in Diderots encyclopedia

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What about today?

• If ICT has done anything, it has reduced access
  costs.
• We no longer deal with data ? we have
  meta-data, amazing quantities of information
  that can only be accessed with sophisticated
  searchware.
• We can search for nanoscopic needles in
  haystacks the size of Montana.
• This is certainly not without its drawbacks, as
  both spies and advertisers know more and more
  about us.
• But it has enormous implications for further
  scientific research and technological advances.

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• Anyone engaged in research can access vast banks
  of knowledge and data. Cloud technology is just
  getting started. We measure storage now not in
  petabytes but Zettabytes (a million petabytes)
  and Yottabytes (1000 Zettabytes)
• (WHO makes up those terms? --- there is also
  Brontobytes).
• And they move around the planet in seconds. As
  Matt Ridley has remarked, The cross-fertilization
  of ideas between, say, Asia and Europe, that
  once took years, decades, or centuries, can now
  happen in minutes.
• .

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Public databases are a huge step forward in
codified knowledge

• All these databases (think Pubmed) are accessible
  free of charge, with no physical effort, at the
  click of a mouse.
• Louis Pasteur never had it so good.
• But what is true for medical science is true
  across the board, in material science,
  astrophysics, molecular plant genetics, and
  economic history. Big-data is changing research
  in every field.

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• Factor 4 Incentives

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• Economists love incentives. But in the generation
  of science, especially, they are problematic,
  since knowledge cannot be owned or sold the
  way other assets are owned and sold.
• Europe between 1500-1700 found a solution great
  scientists acquired reputations among their
  peers, and these reputations provided them with
  patronage positions.
• Galileos position at the court of the Grand-duke
  of Florence is the most famous example.

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• Following the publication of his Siderius Nuncius
  he was appointed "Chief Mathematician of the
  University of Pisa and Philosopher and
  Mathematician to the Grand Duke" of Tuscany. The
  appointment was for life.
• It was a very cushy patronage job. But many other
  distinguished scientists were given similar
  arrangements.
• This created incentives that worked discover
  something, get others to notice, become famous,
  and youre set (almost) for life.

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• These rules still set the stage by which the game
  of creating science is being played.
• They are not perfect, but probably the best we
  can do. And they worked well in the past.
• What about today?

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In our age we richly reward and honor successful
inventors and scientists.

• Although most innovators capture only a minute
  portion of the social surplus they create, we
  tend to respect and reward them. And they still
  prefer (mostly) being famous to being rich.
• And patents, despite everything that is wrong
  with them (a lot) still constitute a strong ex
  ante incentive for innovators. But we also deploy
  other means economic security through tenured
  jobs, first-mover advantage, prizes.
• These incentives have worked well for centuries.

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• Except that today they work better globalization
  creates global superstars.
• A Nobel prize means a lot more than some Swedish
  kroner and dinner with the King. It means global
  celebrity status.

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One final thought

• Science and Technology advance most rapidly when
  the world poses them with well-defined and
  urgent problems that need a solution (and those
  who solve it will be well-rewarded) and that are
  within the capabilities of that society (unlike
  some advances that are at first a solution
  looking for a problem.)
• It involves realizing that solving them will
  enhance social welfare significantly. Rosenbergs
  idea of focusing devices.
• In other words, it helps to have a clear-cut
  agenda.

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• The eighteenth-century Industrial Revolution did
  exactly that. Britain faced a number of
  well-defined problems
• How to pump water out of coalmines.
• How to spin high quality cotton yarn
  inexpensively.
• How to turn pig iron into wrought iron.
• How to fight smallpox.
• How to solve the longitude at sea problem.

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• Of course, only the problems that were in their
  reach were solved. Eighteenth-century engineers
  could not build airplanes or submarines, tame and
  harness electricity, and even cheap steel eluded
  them for a long time.
• The twentieth century did the same for a host of
  problems, from the Haber-Bosch nitrogen-fixing
  process (1912) to Project Manhattan to polio
  vaccines

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Similarly, in our own age many well-defined
problems

1. Global warming and climate change.
2. Ocean acidification (global warmings evil
   twin)
3. Desertification and water scarcity.
4. Multidrug resistance to antibiotics.
5. Energy storage and transmission.

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1. Digitally-driven mass-customization
2. Fish and seafood depletion.
3. Growing obesity.
4. Mental deterioration with age.
5. Information overload.

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• Both the supply and the demand are there. We have
  the tools to solve these problems, and the need.
• Yet, institutional and political factors may get
  in the way in many places and slow down or block
  advances that are technically possible.
• However, the good news about globalization is
  that if problems get solved somewhere, they are
  solved everywhere.

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Is this an unqualified rosy scenario?

• Not necessarily.
• Institutions and politics have not advanced at
  the same rate as science and technology since
  1750.
• And hence there may be an imbalance between our
  technological and our political capabilities.

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• As Freud said with masterly understatement in his
  The Future of an Illusion, While mankind has
  made continual advances in its control over
  nature and may be expected to make still greater
  ones, it is not possible to establish with
  certainty that a similar advance has been made in
  the management of human affairs.

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To sum up

• We are not like the late Roman Empire or Qing
  China, about to languish into an age of decline
  to be followed possibly by chaos and barbarism.
• Technological progress is still remote from
  reaching a ceiling or even diminishing returns
  (and may never do so).
• Economic growth, in an economically meaningful
  way (if not necessarily in a traditional NI
  accounting way) will continue.
• Secular stagnation Seems unlikely to be the
  problem.

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• The Digital Age will be to the Analog Age what
  the iron age was to the stone age.
• And we cant even imagine what the Post-digital
  Age will look like. No more than Archimedes could
  imagine CERN.

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• Thank you

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• As Freud said with masterly understatement in his
  The Future of an Illusion, While mankind has
  made continual advances in its control over
  nature and may be expected to make still greater
  ones, it is not possible to establish with
  certainty that a similar advance has been made in
  the management of human affairs.

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