The argument that innovation has slowed is pretty simple. In the developed world, per capita output has to be driven by innovation. To some extent people can work harder, but that’s pretty limited. We can see that by the best measures we have, growth of per capita output has been slowing since the 70s and especially since 2000. That means that innovation is slowing. The counter argument is that the best methods of measuring output aren’t good enough, and that the newer forms of innovations are not captured as well as older forms of innovation. I guess that’s possible, but its not obvious. After all a lot of tech companies are worth a lot of money.
Like actually for free? Not many. Almost everything either requires me to be exposed to ads or to purchase something to be able to consume it. There is a free newspaper where I live, but that has ads. To access the internet I need to buy some sort of device and then pay someone for access to the internet. I can get internet for free in certain businesses or public places (libraries I guess), but in the case of libraries they are supported by tax dollars and the cost is part of GDP. For businesses, providing free wifi is a good way to get people in the door and/or sticking around to consume more overpriced coffee or whatever. So, none of these things are free. Certainly not more free than radio or TV were in the 20th century. The internet isn’t even more free than cable TV since both require ongoing payments in addition to buying the initial device.
That isn’t to say that I don’t feel like i am getting a good deal. I certainly do feel like a lot of things on the internet are good deals. But so what? a lot of things in real life are good deals also. Do internet/tech related businesses create more consumer surplus per dollar of revenue generated than more traditional businesses? I have no idea, but I’m confident that I can’t figure it out just by thinking about how amazing things are today.
Yes, point made—“free isn’t”. Now, how relevant is it to the point you made above?
You were doing econometrics, and this stuff isn’t absolutely invisible, but it’s much lighter-weight. I can read books and watch movies and send letters and get the news and publish stories for a very modest (0 marginal) monthly fee and watching some ads which, since this isn’t the boom days of the 90s, isn’t even all that much money behind the scenes.
In the old days, so much less of that would have happened, and it was great value—but because it’s so cheap, it’s discounted.
Basically: does the CPI (or whatever inflation measure you’re using) incorporate the (marginal) price of renting a video? … on Youtube? Does it include the price of getting a book? … from an author who put it on the net?
If people had and did all the things we do for each other now, but without any additional money flying around began putting up beautiful artwork everywhere that made everyone’s life an utter joy… the economic indicators wouldn’t notice.
If we’re going to treat being exposed to ads as a sufficient condition for “not free,” then I’d think that any experience which presents even trivial inconveniences would have to be classified as not free, regardless of whether it costs any money. Seeing ads doesn’t actually induce an obligation to buy anything. Personally, I have never bought anything that I have received online ads for (I know that people tend to be very bad at remembering how ads influence their buying behavior, but ads tend to invoke in me a very strong contrarian response which actively prevents me from buying the products.)
Also, some things have cost in the sense that they’re supported by tax dollars or other communal funds, but these things are generally paid for whether you use them or not, so you incur no additional expense by using them.
The argument that innovation has slowed is pretty simple. In the developed world, per capita output has to be driven by innovation. To some extent people can work harder, but that’s pretty limited. We can see that by the best measures we have, growth of per capita output has been slowing since the 70s and especially since 2000. That means that innovation is slowing. The counter argument is that the best methods of measuring output aren’t good enough, and that the newer forms of innovations are not captured as well as older forms of innovation. I guess that’s possible, but its not obvious. After all a lot of tech companies are worth a lot of money.
Not obvious? How many really amazing things can you get for free these days?
Like actually for free? Not many. Almost everything either requires me to be exposed to ads or to purchase something to be able to consume it. There is a free newspaper where I live, but that has ads. To access the internet I need to buy some sort of device and then pay someone for access to the internet. I can get internet for free in certain businesses or public places (libraries I guess), but in the case of libraries they are supported by tax dollars and the cost is part of GDP. For businesses, providing free wifi is a good way to get people in the door and/or sticking around to consume more overpriced coffee or whatever. So, none of these things are free. Certainly not more free than radio or TV were in the 20th century. The internet isn’t even more free than cable TV since both require ongoing payments in addition to buying the initial device.
That isn’t to say that I don’t feel like i am getting a good deal. I certainly do feel like a lot of things on the internet are good deals. But so what? a lot of things in real life are good deals also. Do internet/tech related businesses create more consumer surplus per dollar of revenue generated than more traditional businesses? I have no idea, but I’m confident that I can’t figure it out just by thinking about how amazing things are today.
Yes, point made—“free isn’t”. Now, how relevant is it to the point you made above?
You were doing econometrics, and this stuff isn’t absolutely invisible, but it’s much lighter-weight. I can read books and watch movies and send letters and get the news and publish stories for a very modest (0 marginal) monthly fee and watching some ads which, since this isn’t the boom days of the 90s, isn’t even all that much money behind the scenes.
In the old days, so much less of that would have happened, and it was great value—but because it’s so cheap, it’s discounted.
Basically: does the CPI (or whatever inflation measure you’re using) incorporate the (marginal) price of renting a video? … on Youtube? Does it include the price of getting a book? … from an author who put it on the net?
If people had and did all the things we do for each other now, but without any additional money flying around began putting up beautiful artwork everywhere that made everyone’s life an utter joy… the economic indicators wouldn’t notice.
See also this exercise from an economics textbook.
If we’re going to treat being exposed to ads as a sufficient condition for “not free,” then I’d think that any experience which presents even trivial inconveniences would have to be classified as not free, regardless of whether it costs any money. Seeing ads doesn’t actually induce an obligation to buy anything. Personally, I have never bought anything that I have received online ads for (I know that people tend to be very bad at remembering how ads influence their buying behavior, but ads tend to invoke in me a very strong contrarian response which actively prevents me from buying the products.)
Also, some things have cost in the sense that they’re supported by tax dollars or other communal funds, but these things are generally paid for whether you use them or not, so you incur no additional expense by using them.