(2012-02-16) Rao Return To No Growth
*Industrial economics is based on the idea that wealth is not limited; that Schumpeterian creative-destruction can create new wealth. This has translated, in practical terms, to the idea of a sustainable growth rate. And an entire cultural model based on growth.
That idea lasted about a couple of centuries, until the 1980s, when the first whispers about the “AttentionEconomy” began to appear.
Since then, a lot of us (me included) have started believing that we are returning to Zero-Sum economics (or even Negative Sum) economics. Horrifying though it may seem to us today, this isn’t actually a terrible condition to be in, if you frame it right, and build an economic model predicated on zero/negative-sum ideas.
The basic idea is that the illusion of sustainable growth fostered by the Industrial Revolution was based on a fallacy. Industrial wealth-creation isn’t about creating new wealth using technology (Progress), but exploiting human attention (or time) with increasing efficiency. This exploitation eventually hits diminishing returns. Backing away from squeezing every last nanogram of value out of human attention might not be such a bad thing.
The counter-argument to this (apparently gloomy) line of thought is ClayShirky’s famous notion of a Cognitive Surplus.
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