The Courageous State is the cure for the problems caused by The Courageous State

Edmund Phelps was the 2006 Nobel laureate in Economics and is director of the Center on Capitalism and Society at Columbia University. He argues in the FT this morning that the:

slowdown [in European growth] resulted from narrowing innovation. Even in the postwar years, innovation in Europe was feeble by past standards. In the 1960s, it slackened again, leaving the continent largely dependent on America for new ideas that would generate further productivity growth. But in the 1970s American innovation, confined to Silicon Valley, waned in the aggregate. The pool of past American advances on which Europe could draw would narrow to a trickle and lead to the productivity slowdown on the continent in the late 1990s and which came later to Germany.

This is an idea I have put forward on this blog, often.

The simple fact is that the need for the goods and services that the market supplies has been, to a very large degree, satisfied by the current state of technology given the current state of wealth and income distribution in Europe and there is little or no chance of some new technology coming along and changing that any time soon, not least because no one is investing to make that happen.

No, it isn’t an idea that you’ve put forward often.

The productivity growth of the 50s and 60s was largely catch up growth from the 30s and 40s. The slow down of productivity growth in the 70s and 80s was largely an effect of the growing regulatory state. Productivity growth increased as that regulatory state was dismantled to a small extent in the late 80s and 90s.

Phleps most assuredly ain’t agreeing with you Ritchie, m’lad.

10 thoughts on “The Courageous State is the cure for the problems caused by The Courageous State”

  1. He thinks the “need” for goods and surpluses is now largely satisfied.
    1. Just rubbish
    2. Just look at the leftist bastard deciding we have enough of what we need and so shouldn’t ask the Courageous State for any more.

  2. bloke (not) in spain

    “and there is little or no chance of some new technology coming along and changing that any time soon”
    Jeez! Economics must be in the Arts curriculum.
    Meanwhile the Science community is looking at the looming technological singularity & making bets on which month.

  3. We have everything we need, business isn’t investing any more and no new technological developments are expected?

    He’s completely and utterly barking mad isn’t he?

    Trouble is, he’s so wedded to the ‘”capitalism has failed, we’re all doomed unless you follow me” doctrine that he just willfully ignores everything (and it is just anbout everything) that demonstartes he’s wrong.

  4. bloke (not) in spain

    It is reminiscent of the opening of the US Patents Office & the view at the time, it would soon be redundant because everything that could be invented mostly had been.

  5. AndyC

    He’s one of the most dangerous men in the world – forget ‘Jihadi John’ – this guy should be in the crosshairs.of every news organization – little wonder that his main funding source turned out to be backing a charity sympathetic to ISIS…

  6. So innovation pretty much dried up in the 70s?

    He’s typing this on, what, a Commodore PET? But how’s he disseminating it? Wasn’t usenet early 80s? He’ll be producing those purple pre photocopier pages and handing them out at street corners then.

  7. “and there is little or no chance of some new technology coming along and changing that any time soon”

    Tax expert, authority on all things economic, legal scholar and now technological visionary!

    How do you think he comes up with his forecasts of the future? Tea leaves?

    And just off the top of my head, 3D printing is a recent innovation which has barely begun to be exploited.

    Richard Murphy, the Doris Stokes of the Left.

  8. GlenDorran

    I can think of Driverless cars, Drone Deliveries, Biometric access – a whole raft of changes – read any trade publication in the field of transport or technology and you come up with this. It’s often said that his vision is very reminiscent of a fascist state – preserved in aspic it would seem.

  9. Oh God, the man is a complete imbecile. If he ever ran a business he would be dead in the water within a few years with attitudes such as his.

    How old is the internet, the mobile phone, digital imaging, optical fibre technology? Has he not heard the words recombinant DNA technology, synthetic biology, nanomaterials.

    Does he not know the amount of investment being poured into graphene alone.

    He is a complete buffoon and the Luddite TUC deserves him

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