π Faster, Please! Week in Review #32
Captain Kirk's dreary space reflection; AI accelerating discovery; slavery and the Industrial Revolution; the future of productivity growth
My free and paid Faster, Please! subscribers: Welcome to Week in Review. No paywall! Thank you all for your support! For my free subscribers, please become a paying subscriber today. (Expense a corporate subscription perhaps? Think about it!)
Melior Mundus
In This Issue
Essay Highlights:
β William Shatner's gloomy viral comments about space were ... unhelpful
β Here's more evidence AI is having a big impact on our world. But, you know, faster, please!Best of 5QQ
β 5 Quick Questions for β¦ economist Stephan Heblich on slavery and the British Industrial RevolutionBest of the Pod
β Part two of my conversation with economist Michael Mandel about industrial policy, automation and jobs, and productivity growth β past, present, and future
Essay Highlights
π William Shatner's gloomy viral comments about space were ... unhelpful
In his new autobiography, Star Trek actor William Shatner reflects on his brief voyage into space last year aboard a Blue Origin rocket, explaining that he expected the Overview Effect β the sense of awe and oneness with humanity reported by many astronauts β would make his ascent βthe next beautiful step to understanding the harmony of the universe.β But, he concludes, βthere was no mystery, no majestic awe to behold β¦ all I saw was death.β I have no idea if Shatner intended to give aid and comfort to the space naysayers who see a zero-sum game between making life better down here and extending life further out there. But I fear he has, whatever the intent.Β βEven Captain Kirk thinks space is distraction!β The closest most of us will get to the Overview Effect might be our reaction to first seeing the βPale Blue Dot,β that iconic photograph of a pixel-sized Earth against the vastness of space which takes its name from astronomer Carl Sagan. Reflecting on space exploration, Sagan once offered the sort of reflection I wish weβd gotten from Shatner: βThe idea of an emerging cosmic perspective, of understanding our place in the universe, of a highly visible program affecting our view of ourselves β this might have extremely important benefits for us in clarifying the fragility of our planetary environment and in recognizing the common peril and responsibility of all the nations and peoples of Earth.β
π₯ Here's more evidence AI is having a big impact on our world. But, you know, faster, please!
I absolutely still think itβs possible that in 2031, we will look back at the 2020s as a period when technological progress resulted in faster-than-expected productivity growth. And the promise of artificial intelligence is a big part of my optimism for a New Roaring Twenties. The part of AI-machine learning that gets me most excited is its potential to βaccelerate the pace of discoveryβ and thus combat the problem that big ideas areΒ getting harder to find. So I looked with great interest at the newΒ State of AI ReportΒ by AI investors Nathan Benaich and Ian Hogarth. To what extent is machine learning aiding the discovery process? Hereβs how the authors put it:
Best of 5QQ
π‘ 5 Quick Questions for β¦ economist Stephan Heblich on slavery and the British Industrial Revolution
Stephan Heblich is a professor and Munk Chair of Economics at the University of Torontoβs Munk School of Global Affairs and Public Policy. Heβs also the author, along with Stephen J. Redding and Hans-Joachim Voth, of the new NBER working paper βSlavery and the British Industrial Revolution.β
Slavery predates industrialization by millennia. Why in the 18th century did slavery begin to fuel industrialization? What changed?
Capital accumulation from slave-holding on its own was not sufficient for industrialization. It is only when new technologies are available and can be operated profitably that the extra accumulation of capital, as facilitated by slave-holding, leads to faster growth. Itβs like an engine that is already working, and you attach a turbo charger to it.
Best of the Pod
Michael Mandel isΒ vice president and chief economist at the Progressive Policy Institute. He's also the author of "Investment Heroes 2022:Β Fighting Inflation withΒ Capital Investment," co-authored withΒ Jordan Shapiro.
When we look back on this decade from 2030 or maybe 2035, will we say, βThat was a high-productivity gain where we sort of stepped up,β or we still be having this conversation of βWhat do we need to do to boost productivity growth?β
I'm going to take a step back here. I think we're going to discover that a lot more people are being kept out of the labor force by long COVID than we think right now, and that we're going to be running into labor shortages. And as we run into labor shortages, there is going to be incentive for companies to invest in technology in a way that they didn't do before. We are going to start seeing real growth and productivity as investments in technology spread from the digital sector and in a few other sectors into the rest of the economy. And we'll circle back around to healthcare. What we want from healthcareβ¦
Look at those capital investment numbers.
If you look at capital investment over the last 10 years, it's been running at about half the rate as it was in the previous 10 years. Not just in the US, but in Europeβnot in China, though. That's really what the big distinction is. China did not have the capital investment slowdown that the developed world had. We need investment in technology. We need a willingness to change. We need investment, not just in information technology, but in the biosciences. And that we need a regulatory structure that is flexible enough to adjust to this.