Economists are having a hot debate on whether the economic payoff from innovation has slacked off and The Economist recently ran a long article summarizing the main issues. Why, in an age of smart devices and gene mapping, would one think that innovation is slowing down? One reason is the growth statistics; GDP per capita grew 2.5-5% annually in the 1950s and 1960s but only grew 1% annually so far in the 21st century. The second argument is that today's innovations are less life changing than those of years past. As cool as nanotechnology may be, it is not yet having the same effect on people's well being as indoor plumbing, air conditioning, kitchen appliances, and automobiles.
So should we expect life in 2050 to be about the same as today? I seriously doubt it. Other economic research has shown that there are significant lags between the introduction of a new technology and its full adoption. As the Economist notes, it took a full century for the steam engine to have its full effect; four decades for electricity. Another reason to expect more innovation: rising levels of education in countries across the globe. This means more researchers and more innovations. We also should expect continued improvements in health and longevity, thanks to the innovations in IT and life sciences.
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