The argument of Peter Thiel is that western societies have stagnated technologically in the physical world which is why we’re seeing a lot of the problems we’ve had today. He mentions since the 70s we’ve had very slow physical growth, meaning we aren’t building faster planes, faster trains, etc. Do you believe this is true?
What do economists think about the Peter Thiel theory that western societies have stagnated in the real world?
byu/shadowt1tan inAskEconomics
Posted by shadowt1tan
2 Comments
there’s zero world where that’s true. the obvious example is computing, which should count as physical growth by any definition, but also planes are way safer, fly way smoother, are more efficient, etc., etc. most European countries have also made substantial improvements to their train networks. the only place where there’s been notable productivity stagnation is in construction.
I agree with Thiel on this point. When Thiel talks about this he is comparing the rate of progress in field connected with “tech” such as electronics, computing and pharma to other more fields. By the “physical” he means the large scale physical – aeroplanes, ships, trains buildings and so on. Yes, there has been some progress in these areas, as /u/flavorless_beef points out. But that progress is much smaller than it was in the 20th century.
I think that we can see this from the BEA productivity statistics. Firstly, even many years ago the productivity of the “information” industry was exceptional, for example see [chart 1](https://apps.bea.gov/scb/pdf/2004/11November/1104GDP_by_Indy.pdf) in this article which covers 1987-2000. After that productivity gains in the US have slowed. They have slowed in nearly every sector, but information related sectors have continued to do better than most other sectors. For example, see [figure 11](https://www.bls.gov/opub/mlr/2021/article/the-us-productivity-slowdown-the-economy-wide-and-industry-level-analysis.htm) in this article by the BLS.