THE most striking battle in modern business pits the techno-optimists against the techno-pessimists. The first group argues that the world is in the middle of a technology-driven renaissance. Tech CEOs compete with each other for superlatives. Business professors say that our only problem will be what to do with the people when the machines become super-intelligent. The pessimists retort that this is froth: a few firms may be doing wonderfully but the economy is stuck. Larry Summers of Harvard University talks about secular stagnation. Tyler Cowen, of George Mason University, says that the American economy has eaten all the low-hanging fruits of modern history and got sick.
Until recently the prize for the most gloom-laden book on the modern economy has gone to Robert Gordon of Northwestern University. In “The Rise and Fall of American Growth”, published in January, Mr Gordon argues that the IT revolution is a minor diversion compared with the inventions that accompanied the second industrial one—electricity, motor cars and aeroplanes—which changed lives profoundly. The current information upheaval, by contrast, is merely altering a narrow range of…Continue reading