So we have “the economic literature” with a per-capita GDP mean value in 2100 of $22,900, versus Arnold Kling saying over–way over, in fact!–$20,000,000. What in the world is going on?! Is Arnold Kling a lunatic or completely ignorant, such that he’s off by *more* than a factor of 1000?
I don’t think so. I think he’s right (plus or minus a factor of 10).
The standard literature sees annual economic growth rates of two percent or so. I am thinking that in the middle of this century the growth rate will hit ten percent. Of course, that cumulates to a big difference.
In looking at the future, I tend to agree with Ray Kurzweil, who these days is known for his goal of immortality.
At MIT last week, Kurzweil described a future in which he’s convinced immortality–or a drastically longer life span–will be possible thanks to emerging technologies. His new book, which will hit stores in a few weeks, outlines a special “longevity program” of diet, exercise and nutritional supplements aimed at slowing the aging process.
My thought process is actually quite simple: Economic growth has accelerated in each of the last three centuries. There is enough potential in biotech, nanotech, and computer tech to make it possible for growth to accelerate further.
UPDATES: For some historical perspective, Bruce Bartlett emails me this link to Angus Maddison’s data.
For more nonlinear thinking, see Robin Hanson.
Economists’ best estimates of total world product (average wealth per person times the number of people) show it to have been growing exponentially over the last century, doubling about every fifteen years, or about sixty times faster than under farming. And a model of the whole time series as a transition from a farming exponential mode to an industry exponential mode suggests that the transition is not over yet – we are slowly approaching a real industry doubling time of about six years, or one hundred and fifty times the farming growth rate.
…It seems that each new growth mode starts when the previous mode reaches a certain enabling scale. That is, humans may not grow via culture until animal brains are large enough, farming may not be feasible until hunters are dense enough, and industry may not be possible until there are enough farmers.
…I cannot help but wonder: are we in the last mode, or will there be more?
If a new growth transition were to be similar to the last few, in terms of the number of doublings and the increase in the growth rate, then the remarkable consistency in the previous transitions allows a remarkably precise prediction. A new growth mode should arise sometime within about the next seven industry mode doublings (i.e., the next seventy years) and give a new wealth doubling time of between seven and sixteen days.
The link to Hanson was forwarded to me by Alex Tabarrok, under the heading, “Arnold Kling is a pessimist!!”
For Discussion. If in 1900 you had used previous economic growth to predict growth in the twentieth century, how far wrong would you have been?