Is History a Mystery or Does it Rhyme Every Time?
What Five Technology Surges in the last 250 Years Tell Us About the Future and How Web3 Might Fit Into This Account.
“The past does not repeat itself, but it rhymes.” Mark Twain
We are in a period of great technological and social change, but not for the first time.
What can we learn about the future from analysing past patterns?
According to Professor Carlota Perez, we are in the middle of the 5th technological surge going back 250 years. According to this theory, each surge goes through stages that have some common features, and we are on the verge of a Golden Age for Digital Technology.
There is a natural tendency to seek answers to big questions in dusty history books and to search for patterns in the charts.
History provides us with some entertaining narratives told by the victors.
Economics provides us with black boxes overflowing with big data. Shake the box up with some QE, pandemics and wars, and lets revert in ten years time?
A popular account of historic technological cycles is the Fourth Industrial Revolution. Where I sit in the UK, the economy is predominately a service economy (71% of GDP), manufacturing (18%), and agricultural (less than 1%).
It’s not so much physical assets that create value here, but brands, data, software, trust, and customer relationships.
Can we find a rhyme from previous technological cycles that is worth singing about?
The Five Great Surges of Technology Development
Carlota Perez is a British-Venezuelan Honorary Professor, and in her words, a ‘neo-Schumpeterian all-purpose social scientist’.
Perez argues that we have had four complete technological surges in the last 250 years, and we are in the middle of the 5th technological surge — The Age of Information Technology and Telecommunications, which I refer to as the Digital Age in this article. This period started in the 1970s with the first widely available computers.
Each revolution is driven and associated with a surge in technological development.
The First Surge — The Industrial Revolution — 1771 — when Richard Arkwright’s water-powered factory ushered in machines, mills, and canals.
The Second Surge — The Age of Steam and Railways — 1829 — with the testing of the ‘Rocket’ steam engine for the Liverpool-Manchester railway. We start to see a universal postal service, telegraph, and, city gas.
The Third Surge — The Age of Steel, and Heavy Engineering — 1875 — an era of bridges, ships, and electrification. When Andrew Carnegie’s plant dedicated to the Bessemer process opened, halving the price of steel and facilitating the fourth surge.
The Fourth Surge Age of the Automobile, Oil, Plastics and Mass Production — 1908 — associated with the power of assembly lines producing Henry Ford’s Model T and roads, ports, and, airports.
The Fifth Surge — Age of Information Technology and Telecommunications — 1971 — giving us the Intel processor, global digital telecoms, the internet, email, and erm TikTok.
Each technology surge has similarities in terms of how it progresses and how society responds. (Here are more resources to fully explore this theory)
The first phase is when the technology comes into the market and the infrastructure is built. Some critical factor of production becomes very cheap. Examples include rails for the railroads, assembly lines for the cars, server, and network infrastructure for the internet.
The second deployment phase is when the technology is broadly adopted by society. Examples include the development of the western part of the US in the railroad era. The creation of suburbs, shopping malls, and fast food in the auto era, and the adoption of iPhones, Facebook, and ridesharing in the digital era.
With each transition to the next phase there are the associated battles of power and capital as different interest groups shift positions. There is a turning-point between these two phases. This is often marked by a financial crash and recovery characterised by recession, populism and unrest. At this point political parties are prone to meltdown and take on previously unimaginable new shapes, with boundaries between left and right getting blurred.
Does this sound familiar?
Then there is light at the end of the tunnel — a period of consolidation and widespread gains in productivity from using the new technology. This is called the Golden Age.
During the golden age of mass production, in the 1950s and early 1960s, the interests of business and society converged. With suburbanisation, working-class people in many Western countries could become homeowners and consumers.
Similar points in history cited include 1840s Britain, with Chartism and repealing of the Corn Laws, and the 1930s. Each Golden Age enabled a different lifestyle, for example:-
La Belle Époque in the 3rd wave — Renoir’s 1876 masterpiece in the main image, shows a Sunday afternoon scene in Paris, with people dancing, drinking, and eating galettes (flat cakes) into the evening…Ahh, la joie de vivre!
the sounds of the suburbs were enabled by cheap oil and cars in the 4th wave.
the internet has enabled billions of people to multi-task whilst streaming entertainment 24 hours a day, swipe-right, choose a vintage frock on eBay, bet on live sport, and share Wordles on Twitter. So far so good, but is there more to come?
Are We There Yet?
Despite some obvious gains we have yet to enter the Golden Digital Age, according to Perez’s description of phases, where the benefits of the technology are shared more universally.
There is a debate about whether the internet has delivered enough to be truly transformational. See for example, this account from Ben Thomson.
My view is that the promise of the internet has only been partly achieved.
The internet has brought much value to the 4 billion who can access it, however, it has also brought problems. These include data privacy, business models that concentrate power into a few central nodes, the extensive and inefficient use of intermediaries in many industries. In the last decade, we have had public pushback on the use of personal data
To move into the Golden phase of this Digital Age, and gain more universal benefits, the infrastructure and business models need to move on. I think we might be on the brink of a golden digital age which will take a decade or two to play out.
This is the first part of a longer essay which you can read in full on Workforce Futurist Newsletter.
The full article considers,
What Might The Golden Phase of the Digital Age Look Like? Moving past the bland terminology of Web2 vs Web3.
How Might a New Golden Age of Technology Improve Work? Remote work didn’t start in 2020, what types of investment do we need to make in the infrastructure of work. And will this deliver more universal benefits?
Is the Golden Age Inevitable?
Andrew Spence is an independent workforce strategist. Info Page.