Surveying the Landscape of Economic Change

Figure 1: nested political changes

In most of our work, and particularly for our original research and content, there are one or two key frameworks that help us organize and make sense of the dynamics we (and clients) are observing and experiencing.  In the Third Era one such framework is the nested view of political changes (figure 1).  This particular construct helps us separate out the various changes in political life that are often lumped together in everyday discourse while also allowing us to consider how things interact across these domains.

The Third Era also incorporates frameworks like the Three Horizons, but the above nested view is probably the most important overall framing right now.

Figure 2: education as a socio-technical system

Another framework, this time from our most recent work on learning futures, adapts a socio-technical transitions model to viewing and understanding current and likely changes in education in the United States (figure 2).  This framework provides a compelling way of not only understanding education as a system embedded in larger systems and susceptible to developments in the margins, but also for exploring how education will become ever more shaped by technical influences.  This lets us explore the issue of education becoming a more typical socio-technical system than it has ever been before.

While there are some other, more minor models at work in our learning futures content right now, the nested view above is by far the most central to our work.

Figure 3: layered economic changes

And so, in updating the Infinite Economy, one of the new framings that emerged was that of layered views of economic change dynamics (figure 3).  For the Infinite Economy, there are a number of models/theories related to economic change that we like to draw upon, and this layered view, which builds upon the common analogy of the "30,000 foot view," allows us to incorporate multiple models while (hopefully) not muddying the issue too much.  And while Perez's technological revolutions models is also central to the Infinite Economy framing and forecasts, this layered view is almost more important in the bigger picture (ha, ha) because it allows us to capture in one view some many of the different issues and changes people are confronting.

The ability to organize the many conflicting and contending signals we are receiving today about our economic futures is, to us, a critical ability if one wants to usefully talk about the futures of economic life.

The Infinite Economy

Today we released the highlight booklet for the updated Infinite Economy material.  First presented to audiences in 2012, the Infinite Economy is a look at how the material basis of our modern lives is poised to undergo fundamental transformations over the next several years.

"A review of current global trends such as population growth, continuing industrialization, rising energy demand, massive urbanization, and long term climate change shows that humanity is entering uncharted territory with respect to the material and organizational challenges it will face in the coming decades.

Yet, despite these considerable challenges, a review of humanity’s history and an exploration of the presently dim outlines of the future both strongly suggest that humanity can and is developing the insights and tools to dramatically raise the material security and affluence for all if it chooses to do so.

Thus, the future is very much a matter of vision and of choice."

Please check it out today.

More technological revolutions

In the last post just before New Year's I included a graphic that combined the three horizons framework from Sharpe and Hodgson with the the cyclical sequence of tech-driven economic change.  As promised, here is an additional graphic (build for upcoming content) that illustrates the various technological revolutions that Perez talks about in her book, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages.

We built the waves using the tech revolution start dates ("big bangs") and end dates that Perez identified and built the projected 5th and 6th waves using mean averages of the previous waves.

What's really interesting to me, and what I would really like to focus on more, is the idea that, if in fact innovation is accelerating globally, then will these waves begin to overlap more as the cycle (the "surges") shorten?  The result, I suspect, would be greater turbulence as the different surges, each at different phases in their life cycle, wreak increasing havoc (just kidding) through culture lag, dislocation, and what not.

Mapping technological revolutions onto three horizons

The three horizons framework developed by Bill Sharpe and Tony Hodgson is a favorite of mine, as it is both versatile and provides an good framework to explore interactions and dynamics.  And so, as I was working on new Infinite Economy content, I began mapping recent technological revolutions, a la Carlota Perez, onto the three horizons framework.

Recent technological revolutions mapped onto the Three Horizons

As detailed in her excellent book, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages, Perez develops the notion of long waves of economic eras ever-so-briefly introduced by Schumpeter into a full-blown and well-researched framework of technology-driven economic change.  In the book, Perez talks about the "great surges of development" that have occurred five times since the advent of the Industrial Revolution.  I'll post another graphic later to gets at these "surges," but it's enough for now to say that these waves of change, and the complex dynamics behind them, map perfectly onto the Sharpe and Hodgson 3H framework.

The end of all things

One of our discussions today dealt with big picture issues: global economic order, global political landscape, collapse, etc... The discussion was the first of a series of planned conversations exploring some very big systemic issues, and coming out of this first one we idly wondered about certain trends over time.

So, to get the ball rolling, we ran a quick Google Trends search for certain terms over time.

Not that this necessarily tells us much at the moment, and some of it is entirely predictable, but we were surprised that there weren't higher numbers for "antiglobalization."

15 books for your Christmas list this year

Since it's that time of the year again, we've put together a list of recommended reading that might be helpful if you happen to be shopping around for Christmas gifts for any readers and deep thinkers on your list this year.  The selections below span a range from deep, almost academic treatments to long views of history to works on subjects that are a little more "top of mind."

Thinking About the Future

• The Black Swan: Second Edition: The Impact of the Highly Improbable: While somewhat contentious among trained futurist circles, Taleb's justly popular book on black swan events, randomness, and the limits of knowledge is an important set of intellectual reminders.
• Connections: James Burke's multiple television series on "Connections" is a perennial futures favorite as it wonderfully highlights the contingency of the histories we all take for granted.
• Foundations of Futures Studies: Human Science for a New Era: History, Purposes, Knowledge: For anyone interested in learning about the academic field of futures studies, this is a great place to start.
• Macrohistory and Macrohistorians: Perspectives on Individual, Social, and Civilizational Change: Produced by two great thinkers, this book reviewing big picture theories of social change is a must-read for serious thinkers about the future.
• Scenarios: The Art of Strategic Conversation: A classic work concerned with scenario planning (popularized by the Global Business Network), this book is still recommended by professional futurists to professional futurists.

Economic Futures

• Average Is Over: Powering America Beyond the Age of the Great Stagnation: This most recent work by Cowen paints a vivid though not necessarily encouraging vision of our economic future that will definitely exciting to some, and depressing to others.
• The Great Transformation: The Political and Economic Origins of Our Time: Certainly receiving renewed interest since 2008, this famous work by Polanyi introduces both an important critique of modern economic flows and new definitions for understanding economic life.
• Race Against The Machine: How the Digital Revolution is Accelerating Innovation, Driving Productivity, and Irreversibly Transforming Employment and the Economy: The futures of automation and the dislocation of human labor are hot topics at the moment, and this work by Brynjolfsson and McAfee is a wonderfully short and clear dive into the subject.
• Radical Abundance: How a Revolution in Nanotechnology Will Change Civilization: Drexler almost single-handedly kicked off the nanotech craze with his book, Engines of Creation.  In his most recent work he returns to an exploration of the technology that remains poised to revolutionize material life.
• Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages: For those interested in either "creative destruction" or solid theories of economic change, Perez's book on long cycles of technology-driven change is sure to delight.

Political Futures

• The Future of Power: Critical to any exploration of political futures is some consideration of power, and Nye's book does an excellent job of exploring the changing nature of power on the global stage.
• No One's World: The West, the Rising Rest, and the Coming Global Turn: Amid the recent deluge on books about the future of the world order, the rise of China, and/or the decline of the US, Kupchan's book was an interesting, thought-provoking suggestion that the future will not be a new hegemony, but something with greater political diversity.
• The Shield of Achilles: War, Peace, and the Course of History: For those interested in how the modern nation-state came to be, and what historical patterns suggest for it's future, Bobbitt's incredibly detailed account and theorizing will be thoroughly engrossing.
• Why the West Rules--for Now: The Patterns of History, and What They Reveal About the Future: Any long-view and deep history buffs will be sure to enjoy Morris' thoroughly engaging exploration about the patterns that made, and perhaps continue to make, the world order.
• Zero-Sum Future: American Power in an Age of Anxiety: Another in a long list of works on global political futures, Rachman's book is useful for the reminder that the world doesn't fall neatly into two ideological camps on all issues; rather it splits up messily according to specific issues.