Beyond the Technological Revolution


Author: Carlota Perez

Digital and green: a very convenient marriage
By Carlota Perez

Pundits and political leaders alike, after the initial surprise – and having been caught off base by the Covid-19 pandemic – started to reach for references in an attempt to cope with the situation. Comparisons to the aftermath of WWII and the Marshall Plan have become common. To be sure, the orders of magnitude are entirely different. But the pattern and the occasion show decisive similarities. In both cases, the historical moment is an inflection point in the middle of a technological revolution (the mass production revolution then; the ICT revolution now), between a first traumatic phase of installation of a new set of technologies, and a second phase of deployment when the benefits reach broader sectors of society. This turning point is usually a financial crash followed by a major crisis. Four months into the Covid-19 pandemic, the ensuing worldwide recession has been so far the biggest since the Great Depression of the 1930s. For those thinking the worst is over, signs are that we may only be at the end of the beginning....

The Post-Covid 19 crisis is a once-in-a-lifetime opportunity
By Carlota Perez

Pundits and political leaders alike, after the initial surprise – and having been caught off base by the Covid-19 pandemic – started to reach for references in an attempt to cope with the situation. Comparisons to the aftermath of WWII and the Marshall Plan have become common. To be sure, the orders of magnitude are entirely different. But the pattern and the occasion show decisive similarities. In both cases, the historical moment is an inflection point in the middle of a technological revolution (the mass production revolution then; the ICT revolution now), between a first traumatic phase of installation of a new set of technologies, and a second phase of deployment when the benefits reach broader sectors of society. This turning point is usually a financial crash followed by a major crisis. Four months into the Covid-19 pandemic, the ensuing worldwide recession has been so far the biggest since the Great Depression of the 1930s. For those thinking the worst is over, signs are that we may only be at the end of the beginning....

The (possible) positive consequences of the economic collapse precipitated by the pandemic
By Carlota Perez

The collapse of the economy was going to happen anyway. The irrational bull market in the NYSE was completely decoupled from the real economy. Besides, world debt had reached equally unmanageable heights. However, I think it’s good that, instead of a pure financial crash that makes governments rush to save the banks, we have a wide‐ranging economic collapse that forces governments to think more broadly about how to save businesses of all sorts and the vulnerable people without a proper safety net...

Why everybody –including business– should support the Green New Deal
By Carlota Perez

I see the Green New Deal (GND) bill presented by Ocasio‐Cortez and Markey to the House of Representatives as the first draft of a blueprint for bringing the US – and the countries that might follow – into a boom similar to the one achieved after WWII. It turns the environmental problem into a solution for the social challenges facing America – and the world...

Second Machine Age or Fifth Technological Revolution? (Part 9 – Final)
The socio-political shaping of a better future with an understanding of the nature of the new technologies

The posts in the last weeks have looked at the policy suggestions made by Brynjolfsson and McAfee in The Second Machine Age. As noted, even they see these as modest (p. 228). In fact, even implementing them all, the results would be meagre, in relation to the challenges the authors present. Indeed, if they were faithful to the subtitle of their book: Work, Progress and Prosperity in a Time of Brilliant Technologies, they would indeed be much bolder...

Second Machine Age or Fifth Technological Revolution? (Part 8)
The limits of the Brynjolfsson and McAfee policy recipes: Proposals on fiscal stability and welfare

In the section on taxation, we see again that it is not that Brynjolfsson and McAfee do not have recommendations that are good, if very specific, for adjustments to the current system. They prescribe Pigovian taxes (taxing the ‘bads’) on pollution, congestion, and so on; a tax on land and higher income taxes for high earners (the ‘superstars’). All these suggestions are useful; the latter two have been in and out of favour as policy options since the first Industrial Revolution and are now...

Second Machine Age or Fifth Technological Revolution? (Part 7)
The limits of the Brynjolfsson and McAfee policy recipes: Proposals on science, technology and infrastructures

As is customary among orthodox economists, Brynjolfsson and McAfee claim that the role of government is to fund ‘basic’ research, i.e. the scientific foundation for technologies, and let the private sector do the rest. “It’s almost universally agreed among economists that the government should be involved in building and maintaining infrastructure— streets and highways, bridges, ports, dams, airports and air traffic control systems, and so on...

Second Machine Age or Fifth Technological Revolution? (Part 6)
The limits of the Brynjolfsson and McAfee policy recipes: Proposals on human capital

Most of The Second Machine Age is focused on describing current and future technical change, accompanied by warnings about its speed, depth and worrying social consequences. From the potential of robotics and artificial intelligence (AI) to decimate jobs for humans to the multiple negative effects of increasing inequality, Brynjolfsson and McAfee share the concerns of all those who care about our socio-economic future, from those focused primarily on...

Latest BTTR Working Paper online now
BTTR WP2018-1: A Smart Green ‘European Way of Life’: the Path for Growth, Jobs and Wellbeing

Our latest working paper focuses on a key source of demand-pull that has led to Golden Ages in previous revolutions: a paradigmatic shift in society’s image and practice of the ‘good life’. These changes in lifestyle, underpinned by the new technologies...

Second Machine Age or Fifth Technological Revolution? (Part 5)
Does technology determine the future? Socio-political shaping as a recurring need within the unique space of the possible

In the 1950s and 60s it was widely believed that capitalism had found its true nature and that the world would gradually move towards the model developed in ‘the West’. Johnson’s ‘Great Society’ idealized what could still be achieved along that path. This was reinforced in the early 1990s by Fukuyama’s The End of History, which held that Liberal democracy had triumphed and that its critics, especially the Marxist ones, had been defeated by the facts. With the bloodless dissolution of the Soviet Empire, not only was the Cold War over, but also any attempt to question the superiority of capitalism...