From what I understand, you're arguing that the last three booms in the U.S. & Japan corresponded quite nicely with increases in the population.
Now, I'm no social scientist, but I imagine that those on this thread who are could tell you that "three out of three" isn't a very compelling pattern. It could very easily be an exercise in data mining--you don't need to look that hard to find a metric that have correlated well with the last three booms.
Even if there is a causative link between population growth and economic good times, it could just as easily go the other way. It seems to me, when times are good, people are a) more likely to birth babies, and b) more likely to immigrate to the united states.
Furthermore, even if it were true that historically, booms were driven by population growth, that doesn't really persuade me that we can only boom in periods of population growth. As someone else pointed out, the context has changed. Unless we have a really compelling and coherent thesis for why population growth has tended to drive economic growth, it's hard to figure out if that theory still works in today's context.
The amazing thing about technology today isn't just that it makes our lives better, it's that:
-it makes us far more productive
-it's enabling: it builds upon itself to become ever-more useful.
Now, pre-computer technology also made us more productive. Transportation, especially. The invention of the locomotive and the automobile made it much, much easier to transport goods and people, making the economy move so much quicker and more efficiently. The telephone, likewise, made it much easier to transport information. But for the most part, these technologies weren't all that leverageable. The automobile was basically a one-shot deal. Once we had them, the only way they got better was by getting a little faster, or safer, or more comfortable, or fuel-efficient. But that only goes so far--I think we'd all agree that the innovations in automobiles over the last twenty years pale in comparison to the 1920-1940 years. In fact, the innovations in automobiles today are mainly about leisure, not productivity.
Computer technology, however, is far more interesting. Why? Several reasons:
-The basic technology gets better and better very rapidly. Even if it were economical to build and safely operate cars that go 600 miles per hour, it wouldn't be that useful. I mean, shaving off 90% of my 10-minute commute isn't that big a deal. There's a cap on the utility we can get from these technologies. Computers, however, are about processing information. I think we all agree that we could use far, far more computing resources. Things like AI, smarter communications, or rich media are of apparent value to us, but require a lot more computing power. And Moore's Law tells us that we can expect rapid improvements in processing power to continue. The rate of innovation in cars has slowed, but not in computers. Do you think computers have become more useful from 1990-2000 than from 1950-1960? Yeah, me too. The computer revolution is just beginning.
-computer technology builds upon itself (it's enabling). That's actually a pretty amazing trick. It's not like we can incorporate automobile technology into other things to make them go faster. Make your restaurant serve food so much faster by incorporating automobiles into it. It just doesn't make sense. The computer market, on the other hand, is built upon platforms. And platforms are about integrating, simplifying, and cheapening core functionality that all sorts of other applications want. For instance, when Microsoft incorporated TCP/IP into windows 95, it became much, much simpler to write internet-enabled applications. That sort of reuse of technology is just stunning.
Throw communications into the mix
Up until now, we've had two types of parallel innovations: better processors, and better software. The hardware has gotten better and better at processing information, and the software has gotten better and better at finding information to process. Now, however, we have three parallel technologies: processors, software and communicators. All of a sudden, it's not just about processing information, it's about processing and transporting technology; not just information, but information at your fingertips. And it's up to great software to take advantage of both of those technologies. If moore's law says that the value of processors will double every 18 months (59% improvement per year), and Cao's law says that communicators double in value every 9 months (152% improvement per year), that means that software can take advantage of not a 59% improvement, but a 300% improvement. (1.59 * 2.52 = 4, or 2^(2/3) * 2^(4/3) = 2^2 = 4) That's a tremendous increase in the rate of improvement of the underlying hardware.
That, to me, spells a huge change in context. To be fair, we've had one major pre-computer enabling technology: electricity. IMO, computers & communicators are just the fruition of the electrical promise. (the electrocosm ;)) But over the last twenty years, we've seen Microsoft, Intel, Oracle, Sun & Cisco go from about $0 to $1 trillion in market value. IMO, that's not because the population has increased. That's because sixty years ago, a man named Alan Turing invented a marvelous machine.
The fact is, someone is going to be building those processors, someone is going to be building those communicators, and someone is going to be building the software that makes those processors and communicators useful. I say place your bets, and relax.
ardethan@permabull.net |
