Keynes said “In the long run we´ll all be dead”. Unfortunately our descendants will be very much alive, maybe living miserably…
Chess Masters, Entrepreneurs and Economists weigh in. But they´re all talking about dreary prospects for the long run. But so did Thomas Malthus more than 300 years ago. And so did the Club of Rome 50 years ago. It appears that human ingenuity “solves” the long run problem. It seems much harder to “solve” the short-run cyclical one!
From the FT:
There is a fierce debate over the origins of the disappointing economic growth seen in advanced economies. On one side there is former world chess champion and political activist Garry Kasparov and internet entrepreneur Peter Thiel, while on the other, there is Kenneth Rogoff, a Harvard economist.
Mr Rogoff, who authored This Time is Different: Eight Centuries of Financial Folly(2009) with Carmen Reinhart, argues that the systemic financial crisis is the root cause of the prolonged economic slump in the western world. In their research, Mr Rogoff and Ms Reinhart found economic growth following a systemic financial crisis to be about a full percentage point below trend growth.
Mr Kasparov and Mr Thiel, on the other side, disavow Mr Rogoff’s claim that the collapse of advanced-country growth is the result of the financial crisis. In their view, the flailing western economies reflect stagnating technological development and innovation, and without radical changes in innovation policy, advanced economies are unlikely to see any prolonged pickup in productivity growth.
Robert Gordon of Northwestern University espouses an even more dire view, suggesting that the 250 years of rapid technological progress that followed the Industrial Revolution may prove to be the exception, rather than the rule.