Has the ideas machine broken down? is the lead article in the January 12 issue of The Economist. The article takes a look at what it calls innovation pessimism, - the notion that we are in a long-term period of slow innovation and growth despite our rapidly advancing technologies and hyperconnected economies.
“With the pace of technological change making heads spin, we tend to think of our age as the most innovative ever,” says The Economist in the article’s overview. “We have smartphones and supercomputers, big data and nanotechnologies, gene therapy and stem-cell transplants. Governments, universities and firms together spend around $1.4 trillion a year on R&D, more than ever before.”
“Yet nobody recently has come up with an invention half as useful as that depicted on our cover. With its clean lines and intuitive user interface, the humble loo transformed the lives of billions of people. And it wasn’t just modern sanitation that sprang from late-19th and early-20th-century brains: they produced cars, planes, the telephone, radio and antibiotics.”
Northwestern University economist Robert Gordon is one of the leaders of the innovation pessimism camp. In a recent paper, - which he describes as deliberately provocative, - he questions the generally accepted assumption that economic growth is a continuous process that will persist forever. Perhaps the slow growth we are experiencing in the US and other advanced economies is not cyclical, but rather evidence that long-term economic growth may be grinding to a halt. The rapid growth and rising per-capita incomes we experienced during the Industrial Revolution of the past two and a half centuries might have been a unique episode in human history.