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.

Predicting Google

After writing this morning's post, I was thinking about the supreme difficulty of accurately anticipating the new businesses and new business models that emerge in the world (i.e. that "stick"), and the even greater difficulty of anticipating what those new businesses then evolve to become/create/reshape.  Thinking first about the graphic from this morning (Figure 1), consider the "entrepreneurial experimentation" occurring in the Surface layer.

Part of the great challenge in knowing how the economy will ultimately be affected by the entire landscape of changes lies in this area, what roughly corresponds to the "Emergent Models" section of the original Infinite Economy landscape image (Figure 2).  This is an area of basically evolutionary action: variation and selection.  Out of this competitive space eventually emerges the businesses and business practices that go on to (re)define normal.

And this jumps us to thought leadership/consultant's s-curve from "Working the hype cycle, part 2" (Figure 3).  See the orange line the defines the "Application Gap?"  This is the space in which VCs and other investors are developing ever-greater interest in other people trying to develop new things and to make businesses out of new things.  This, of course, is where people are looking for "the next Google."

But of course you can't really know ahead of time what invention/innovation/new venture will succeed (i.e. stick).  That's why they're all bets.  But even if you could get really, really good at anticipating what new piece of technology or what new venture goes on to become established and mainstream, you still couldn't know what they will go on to do outside of their intended application or their original business plan.  It's essentially an issue of, to use Google as an example: Could the folks who invested in Google at their outset truly have been able to anticipate what they might yet do to shape broad economic change in a variety of areas, far beyond improving internet search?

I am certain that the answer is no.  So consider the difficulty in not just "picking winners" amongst all the emerging technologies and business models out there right now (in terms of what they're trying to do right now), and then anticipating how they will evolve to introduce even more fundamental economic changes beyond their original intents.

Thinking about economic futures...

After yesterday's round-up of articles related to economic futures, I spent the early part of my morning thinking more on what the landscape of economic changes looks like today.

For those of who attended the 2012 Hawai'i Futures Summit, you will be familiar with my framing of the Infinite Economy.  For those of you who aren't, you can check out yesterday's post or the 2012 slide deck on slideshare.  The Infinite Economy looks at the full breadth of changes occurring in the world that, collectively, will shape economic life.  In this way the Infinite Economy looks much farther afield than just one or two developments, say 3D printing or renewable energy.  And in it there's a graphic that conceptually tries to see all the elements of this "landscape" (see Figure 1).

Figure 1: the Infinite Economy

In reflecting on this image this morning, I started to list some of the big trends and emerging issues that are found within the Infinite Economy and which people are discussing today.  The list began with:

• Automation
• Digital fabrication
• DIY movement
• Maker movement
• Social financing
• Alternative currency
• M2M/internet of things/ubicomp

A comprehensive list would of course be huge, but after just getting this far I started thinking in a new direction.  Switching to a layered view, I started to list some of the major trends, but also started to add some of the change dynamics that are relevant to anticipating economic futures (Figure 2).

Figure 2: initial iteration of a layered view

In starting to draft this visual I soon realized (and was reminded of) a number of things:

1. This image will need a lot more time and effort to capture enough of the different dynamics of which I think people need to be aware
2. I need to switch to my preferred 11x17 page size :)
3. Thinking about economic futures today truly requires a global perspective.  An exploration that simply focuses on, say, the American scene, will overlook critical shifts and interdependencies shaping economic life
4. And this requires a much more systemic perspective than I think we've traditionally employed when thinking about the "economy"
5. Partly because there seem to be changes occurring on so many levels and across some many domains/boundaries, employing only an "economics" viewpoint will not provide real insight
6. Considering economic futures today requires a practice of zooming in and out to see the different kinds of change dynamics underway (future iterations of Figure 2 will illustrate this point)

Economic futures round up for Thanksgiving

Because everyone has nothing better to do today than hang around on the web reading articles, I've included below a few good articles that bear on economic futures (not to be confused with the stock market term).

1. "A Skeptic's Guide to 3D Printing": as I was saying on Twitter a couple of days ago when this article got posted, this is the best starting point for exploring the futures of 3D printing I have seen yet. And as I've said in previous posts, in its full suite digital fabrication clearly will play in interesting role in rewiring some of our economic life, but the current hype around 3D printing is animated a bit more by people's excitement and imagination than by critical examinations of the development and diffusion of a new technology, which is something this article does well.
2. "Google Enters 3D Printing Arena": Follow the digital fab vein, this short article as an announcement about a development agreement between Google (dba Motorola Mobility LLC :) ) and 3D Systems to build a high speed digital fabrication and fulfillment system to support Motorola's mobile device customization project, Project Ara.  As a colleague has often said, take a quick peek at anything Google gets into.
3. "The Reluctant Visionary": This is a review-of-sorts of Eric Drexler's new book, Radical Abundance: How a Revolution in Nanotechnology Will Change Civilization, which returns us to an examination of what Drexler now calls "atomically precise manufacturing."  Nanotechnology has had its own massive hype in decades past, but in various forms the science and engineering continue to advance and, as always, the promise of what manipulation at the atomic level could mean for human economy is nothing short of revolutionary.
4. "How Google's "Deep Learning" Is Outsmarting Its Human Employees": The last article is from Fast Company and takes us back to Google and into the realms of neural networks and machine learning to look at how Google's system for deep learning is evolving capacities to distinguish objects in the world around it that it's programmers never provided.  Augmentation of human capabilities with machines and the replacement of human effort with machine effort, both fundamental aspects of technological change since the beginning, will of course portend even greater changes in economic life.

And for our early work from last year on framing many of these larger economic shifts:

The Infinite Economy from Richard Lum

Anticipating Economic Change

The Free exchange blog on The Economist recently had the post "The illusion of stasis." commenting on techno-pessimism in other recent writing.  Largely about anticipating the extent or pace of economic transformation, the piece responds to skeptics who, for instance, do not believe that technologies like 3D printing or self-driving cars will be economic game changers.

I'm a big fan of co-evolutionary theories of change, which is why the issue of the co-evolutionary development of a broad landscape of issues lies at the heart of my Infinite Economy concept.  And for that reason I both appreciate and basically agree with the Free exchange author's critique of the current spate of techno-pessimism.  As they say in the post,

In general, a very good way to underestimate the potential impact of a new innovation is to consider its possible contributions all other things equal, that is, assuming that nothing in the economy changes to accommodate or complement the new discovery.

And this is where I have considerable empathy for all those currently looking at digital fabrication (most specifically, 3D printing of plastic) and concluding that most of the excited visions of the future built on extrapolating a future of MakerBot-type appliances are unrealistic hype. The history of economic and technological evolution and revolution shows that concepts and things are involved in oft times intricate interactions with infrastructure, other technologies, social biases, regulatory regimes, and structures like financing regimes. And the essence of co-evolution is that they continually impact each other.

Especially in a globalized, highly interconnected and interdependent world, single-issue or single-technology extrapolation is as bad as single point forecasting.

The Infinite Economy from Richard Lum