Doomsayers are doomed to fail about the end of innovation
There has been an interesting if pessimistic international discussion under way over the past few months about whether innovation – and therefore continued economic growth – has run aground. It holds that the rapid growth that followed a series of industrial revolutions, including our current electronics-driven third revolution, is finally coming to an and. Growth will decline and there will be no fourth industrial revolution to rescue us.
The discussion was sparked by a US National Bureau of Economic Research paper, Is US Economic Growth Over? It was written by economist Robert J Gordon from Northwestern University in the US and provides a thoroughly negative view of our collective economic futures.
He argues that innovation has run into the sand, that there hasn’t been any really new and groundbreaking innovation for the past few decades and so the associated economic growth will relentlessly drift slowly down the graph.
He uses a wonderfully understandable analogy to describe the heights of what innovation can deliver . . . the indoor toilet. There is almost nothing to equal the impact of what this simple innovation delivered in terms of human health, along with its associated sewerage systems and the running water that makes it work. He tested its importance in an equally beguiling way, giving people a choice between two options.
You can either have an old tech computer from a decade ago along with the rudimentary internet of the time, plus indoor plumbing and a toilet in the house, or you can have the latest computer with wireless access and the fastest of internet services to support social media, but no indoor plumbing and only an outdoor loo. No prizes for guessing which option won. The thought of outdoor visits on a frosty morning takes the gloss off fast wifi.
End of the line
The future of innovation as predicted by Gordon is a deadly serious matter, assuming his prognosis is correct. His view holds we have hit the end of the line with innovation, there will be no more game changing developments like the steam engine or the introduction of electricity. As a result, year-on-year growth over the coming decades won’t pass half a per cent a year, suggesting “the rapid progress made over the past 250 years could well turn out to be a unique episode in human history”, he writes.
I can’t comment on his growth calculations but as someone who reports on the conduct and progress of scientific research, then the notion that we have run out of groundbreaking innovation is anathema. The next life-altering innovation may already be here but we have yet to learn about it.