Startups employ a trivial percentage of the workforce and do not contribute much to the economy. Startups that get big occupy more economic space, but by that point they’re no longer startups. So the attributes of startup culture are not really relevant to the economy at large.
I wonder what fraction of GDP in 2060 will be accounted for by the work that startups are doing today. US GDP in 1975 was about 9% of what it was in 2015. Do we think that it was the biggest companies that existed in 1975 that were primarily responsible for driving this growth? Or was it startups that grew over time?
I’m willing to accept that the large companies that exist today are primarily responsible for generating the lion’s share of GDP and employment today. But it seems plausible that startups are more important to the future economy, and thus to absolute long-term levels of production, than large companies that exist today.
This is just pure speculation; I’d be curious to hear what a real economist had to say about this.
I looked up the founding dates of the 30 companies that currently make up the Dow. 19 of them (making up 56% of the index) were founded before 1975, and the other 11 (44%) afterwards.
The DOW itself was only 4.5% of it’s 2015 (nominal) value in 1975
About 10⁄30 of the companies that were in the DOW in 1976 are still major economic drivers today
So, overall, I’d guess 50% of GDP in 2060 will be from companies that exist on January 1, 2022 (using 2020 as a baseline year is all sorts of fraught)
I wonder what fraction of GDP in 2060 will be accounted for by the work that startups are doing today. US GDP in 1975 was about 9% of what it was in 2015. Do we think that it was the biggest companies that existed in 1975 that were primarily responsible for driving this growth? Or was it startups that grew over time?
I’m willing to accept that the large companies that exist today are primarily responsible for generating the lion’s share of GDP and employment today. But it seems plausible that startups are more important to the future economy, and thus to absolute long-term levels of production, than large companies that exist today.
This is just pure speculation; I’d be curious to hear what a real economist had to say about this.
I looked up the founding dates of the 30 companies that currently make up the Dow. 19 of them (making up 56% of the index) were founded before 1975, and the other 11 (44%) afterwards.
The DOW itself was only 4.5% of it’s 2015 (nominal) value in 1975
About 10⁄30 of the companies that were in the DOW in 1976 are still major economic drivers today
So, overall, I’d guess 50% of GDP in 2060 will be from companies that exist on January 1, 2022 (using 2020 as a baseline year is all sorts of fraught)