Innovations and Resistance
an Apple or Google could come along and bargain with several national newspapers to assemble a cheap bundle of online subscriptions. Since the bundler would have a very strong incentive to provide a reasonable price for customers, it would put in the effort to determine what each paper really contributed.
This is not a new idea. See The Club vs. the Silo, which I wrote ten years ago.
Thanks to Tyler Cowen for the pointer. However, I want to say that this example helps explain why I am skeptical of the Great Stagnation thesis. Innovation does not come in “aha” moments. The innovations that are needed to deal with “information wants to be free, but people need to get paid” have still not matured. We are still arguing about the same possible business models we were arguing about when Varian and Shapiro wrote Information Rules. What looked like low-hanging fruit back then has still not been picked.
While I’m at it, let me reiterate that Tyler is playing things both ways in TGS. On the one hand, he wants to complain about a lack of productivity. On the other hand, he wants to complain about a lack of job creation. I buy into the view that we have been seeing a high ratio of job destruction to job creation. But to me that is a symptom of ongoing innovation.