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By Root 667 0

In the past, when societies gorged on innovation, they soon allowed their babies to grow too numerous for their land, reducing the leisure, wealth and market that inventors needed (in effect, the merchant’s sons became struggling peasants again). Or they allowed their bureaucrats to write too many rules, their chiefs to wage too many wars, or their priests to build too many monasteries (in effect, the merchants’ sons became soldiers, sybarites or monks). Or they sank into finance and became parasitic rentiers. As Joel Mokyr puts it: ‘Prosperity and success led to the emergence of predators and parasites in various forms and guises who eventually slaughtered the geese that laid the golden eggs.’ Again and again, the flame of invention would splutter and die ... only to flare up elsewhere. The good news is that there is always a new torch lit. So far.

Just as it is true that the bush fire breaks out in different parts of the world at different times, so it leaps from technology to technology. Today, just as during the printing revolution of 500 years ago, communications is aflame with increasing returns, but transport is spluttering with diminishing returns. That is to say, the speed and efficiency of cars and aeroplanes are only very slowly improving and each improvement is incrementally more expensive. A greater and greater amount of effort is needed to squeeze the next few miles per gallon out of vehicles of any kind, whereas each tranche of extra megabits comes more cheaply for now. Very roughly, the best industry to be in as an innovator was: 1800 – textiles; 1830 – railways; 1860 – chemicals; 1890 – electricity; 1920 – cars; 1950 – aeroplanes; 1980 – computers; 2010 – the web. Whereas the nineteenth century saw a rash of new ways to move people about (railways, bicycles, cars, steam ships), the twentieth century saw a rash of new ways to move information about (telephones, radio, television, satellites, fax, the internet, mobile telephones). Admittedly, the telegraph came long before the aeroplane, but the general point stands. The satellite is a neat example of a technology invented as a by-product of a transport project (space travel), which found a use in communications instead. Increasing returns would indeed peter out if innovators did not have a new wave to catch every thirty years, it seems.

Note that the greatest impact of an increasing-return wave comes long after the technology is first invented. It comes when the technology is democratised. Gutenberg’s printing press took decades to generate the Reformation. Today’s container ships go not much faster than a nineteenth-century steamship and today’s internet sends each pulse little quicker than a nineteenth-century telegraph – but everybody is using them, not just the rich. Jets travel at the same speeds as they did in the 1970s, but budget airlines are new. As long ago as 1944, George Orwell was tired of the way the world appeared to be shrinking, supposedly a modern event. After reading what he called a ‘batch of rather shallowly optimistic “progressive” books’, he was struck by the repetition of certain phrases which had been fashionable before 1914. The phrases included the ‘abolition of distance’ and the ‘disappearance of frontiers’.

But Orwell’s scepticism misses the point. It is not the speed but the cost – in terms of hours of work – that counts. The death of distance may not be new, but it has been made affordable to all. Speed was once a luxury. In Orwell’s day only the richest or most politically powerful could afford to travel by air or to import exotic goods or make an international telephone call. Now almost everybody can afford the cheap goods carried by container ships; almost everybody can afford the internet; almost everybody can afford to travel by jet. When I was young a transatlantic telephone call was absurdly expensive; now a transpacific email is absurdly cheap. The story of the twentieth century was the story of giving everybody access to the privileges of the rich, both by making people richer and by making services cheaper.

Likewise,