Technology’s Real Benefits (Hint: They’re Not Economic)

by Andrew McAfee on May 3, 2013

A couple recent articles, one in the WSJ by Dennis Berman and one in the NYT by Eduardo Porter, have raised the question of why all the amazing technologies we have these days aren’t showing up more strongly in the productivity and GDP growth statistics. This is both a really important question, and one that misses the point.

It’s really important because technology optimists like myself should be able to point to stats showing how much the new digital tools have accelerated the march of economic progress. And for a while there, we could. Productivity growth took off in the mid 1990s, and research (led, I’m proud to say, by my colleague and coauthor Erik Brynjolfsson) showed conclusively that this was due mostly to information technology.

But then productivity growth tapered off in the middle of the 2000s, and hasn’t really recovered. No one knows exactly why. Some extremely smart people, Northwestern economist Bob Gordon among them, think that’s because the information technology revolution is essentially over, and we’re headed back into the productivity doldrums. In fact, he thinks we might well be headed back into an extended time of slow to no economic growth. Erik and Bob had a debate on the subject at the TED conference this year. Click the links in the previous sentence to watch their talks and debate.

I’m on Erik’s side (duh). It’s impossible for me to imagine that Web 2.0; smartphones, tablets, and the app explosion they generated; warehouse and factory robots; self-driving cars and drone planes; AI sophisticated enough to crush the best human Jeopardy! players; and the rest of the continually unfolding and expanding portfolio of modern digital technologies are going to be economically insignificant. I’m with veteran technology scholar Dan Sichel, who, according to the WSJ article, “calls the current productivity rates merely a pause.”

But honestly, all of this is kind of missing the point. In the NYT article Erik nicely summarizes why too strong a strong focus on economic measures like productivity and GDP is misleading: “GDP is not a measure of how much value is produced for consumers. Everybody should recognize that GDP is not a welfare metric.”

So how are computers doing at improving non-GDP, non-productivity measures of human welfare? Astonishingly well. I doubt that there’s any objective way to add up the welfare benefits stemming from modern digital technologies, but here again, I’m with Sichel “If you think about almost any dimension of human activity, it will ultimately be touched by this ability to harness computational power.” A couple recent examples illustrate the deep and fast digital transformation of… just about everything.

The first example is cancer research. As a recent NYT story by Gina Kolata highlights, a number of recent studies are confirming that it’s more productive to classify cancers by their genetic similarities than by the part of the body where they appear (which is current practice). The genomic approach helps establish the right treatments today, and will likely lead to new and better drugs in the next few years. Says “Dr. David P. Steensma, a leukemia researcher at the Dana-Farber Cancer Institute who was not involved with the studies. “Many developments in medicine are about treatments or tests that are only useful for a certain period of time until something better comes by. But this is something that will be useful 200 years from now. This is a landmark that will stand the test of time.””

This tech-driven, data-driven shift in how cancer is viewed is such a big deal that Jeff Boyd, executive director of the Cancer Genome Institute at Fox Chase Cancer Center, says “I can’t overstate it.”

The other example I came across recently shows that how critical tech is not for improving our health, but instead for understanding our history. A fascinating New Yorker article by Douglas Preston details how LIDAR (Light Detection and Ranging) technology is being used to revolutionize archeology in Mesoamerica. LIDAR is one the main technologies the Google autonomous cars use to ‘see’ their surroundings. It’s also pretty good for seeing through gaps, even small ones, in vegetation to find the structures underneath. This is exactly what’s needed in Mosquitia, an area of deeply inhospitable jungle covering more than 30,000 square miles of Honduras and Nicaragua.

A somewhat ragtag team of a few people flying a beat-up Cessna equipped with LIDAR and inertial navigation rigs were able, on a budget of about half a million dollars, to scan 55 square miles of Mosquitia rainforest and find conclusive evidence of several previously unknown large pre-Columbian, Maya-like cities. It’s a discovery was all but impossible in the pre-digital era when archeologists had to hack through some of the most inhospitable country on the planet, following leads from folklore and hoping to get very, very lucky. Mesoamerican specialist Alicia González looked at the team’s imagery and said “I couldn’t believe it, it was so fabulous. Lidar is going to turn the face of research all the way around. With Lidar, you can do a hundred years of survey work in a few days.”

As a group, scientists are not prone to hyperbole and hype. So when archeologists and cancer researchers start talking about landmarks whose importance can’t be overstated and turning the face of research, we should give the statements some weight.

Digital technologies are revolutionizing our understanding of our world, and they’re doing so at ever-faster rates. I like GDP and productivity growth a whole lot, but I like a better understanding of our time on this planet and reductions in the death and suffering caused by cancer so much more.

Don’t let anyone tell you that technology’s not making things better. We’re in the early stages of a great flourishing brought on by brains and computers — the most powerful tool we’ve ever invented, by far — working together. I’ve said it before and I’ll say it again: we ain’t seen nothing yet.


Martin May 27, 2013 at 11:47 pm

Technology can greatly help us towards development and improvement, not only for our selves but also for the community and productivity. though we cannot deny that there are some disadvantages especially if we do automation. We should put into good use our technology, we should not abuse the use of it. go here

Secular Antitheist Liberal May 31, 2013 at 11:47 am Only if we can keep the technology working for WethePeople. Not bloody likely. The last forty-five years has proven that!

Jerry JACKSON June 30, 2013 at 9:55 am

Perhaps a question rather than a comment. What type of productivity do the statistics measure…? Mostly meaning individual productivity or the system productivity often associated with the Toyota Production System…?

IT Solutions London October 2, 2013 at 6:28 am

Maybe not the economy but it sure has improved lives tremendously.

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