Is American Economic Growth in a Gordonian Knot?

One of the reasons, I suppose, that there has never been a more interesting time to be an economist is that we can all see remarkable technological advances unfolding in front of us, but no one quite agrees what to make of them.  A few years ago, Tyler Cowen published a little e-book, The Great Stagnation, that was widely talked about and reviewed in about a million places.  The man-bites-dog angle there was these technological changes have not translated into more robust growth (building on the Solow Paradox, I suppose, that we “can see the computer age everywhere but in the productivity statistics.”)

Since then, we have seen MIT’s techno-optimist Eric Brynjolfsson weigh in with The Race Against the Machine and Northwestern’s Robert Gordon counter with his “headwinds” argument.  Specifically, Gordon argues that our most productive days are behind us, and that innovation will be insufficient to enable us to sustain the 2% per capita real growth of the 20th century.  If you are so inclined, you can watch Brynjolfsson and Gordon square off in this TED debate.

Gordon has now substantially bolstered his argument with a new book, The Rise and Fall of American Growth.  The massive 762-page tome will certainly be the hottest economics book since Thomas Piketty published Capital in 2014 (and probably read cover-to-cover by approximately the same percentage of readers). But if you don’t have time to wade through the text, there are plenty of people discussing it, including Gordon himself in this PBS News Hour video.

A number of big hitters have offered their thoughts, including Paul Krugman in the New York Times, LU Econ Blog favorite, Ed Glaeser in the Wall Street Journal, and the aforementioned Tyler Cowen for Foreign Affairs.  I expect to see many, many more in the coming weeks.

Certainly, there are plenty of resources to get you thinking about the topic even if you don’t have the book itself.  I currently have procured the Mudd’s copy, and will report back my thoughts when I get to it in 2018.