Interview
a16z Podcast | Knowledge Builds Technology and Technology Builds Knowledge -- with Joel Mokyr
- Core Thesis of "A Culture of Growth": The Industrial Revolution was driven not by isolated inventions but by a synergistic feedback loop where knowledge builds technology and technology builds knowledge, a dynamic that persists today.
- Prerequisite for Technology: Fundamental concepts like the existence of an atmosphere (Torricelli, 17th century) and the possibility of a vacuum were required before steam engines (Newcomen, 1712) could be built; these principles did not exist in the Middle Ages.
- Shift in Epistemology: The era marked a decisive rejection of "ancient wisdom" (e.g., Aristotelian physics) in favor of contestability, where ideas were subjected to empirical testing, logic, and mathematics rather than accepted on authority ("in nullius verba" – on no one's word).
- The Republic of Letters: Knowledge circulated via a spontaneous, virtual network of correspondents and publications that functioned as a "marketplace of ideas," relying on peer vetting to establish trust and credibility.
- Nature of Innovation: Major breakthroughs historically occurred at the margins where disciplines intersect (e.g., game theory in economics, deep learning borrowing from psychology), whereas siloed fields tend toward incrementalism and stagnation.
- Role of Competition: A fragmented political landscape of dozens of competing European states and cities fostered a competitive market for ideas, which economists argue produces better results than uncompetitive markets.
- Reputation as Currency: In both historical and modern contexts, credibility is established through reputation and peer review (tenure processes, authorship priority), which incentivizes the open publication of work.
- Focus on Bottlenecks: Progress accelerates when society collectively identifies and focuses on specific, urgent problems, such as measuring longitude, conquering smallpox, or defeating gravity (hot air balloons).
- Innovation vs. Stagnation: Joel Mokir argues that avoiding innovation due to fears of unintended consequences is dangerous; stagnation is worse, citing 19th-century China's rejection of progress as a historical counterexample to the West's trajectory.
- Measurement of Modern Growth (Missing Growth): Current GDP accounting fails to capture value because it cannot adequately measure:
- Zero-marginal-cost goods: Services like Wikipedia, Netflix, and Spotify provide immense value but register as $0 in national income accounts.
- Product Innovation vs. Process Innovation: Metrics focus on making existing goods cheaper, missing the value of entirely new or vastly improved products (e.g., smartphones vs. old cell phones).
- Variety and Choice: GDP ignores the consumer welfare gained from increased product variety.
- Consumption Transaction Costs: Improvements that reduce time and effort (e.g., online shopping eliminating travel and waiting lines) are not recorded, even though they increase real living standards.
- Leisure and Access: The democratization of spectator sports and entertainment via technology represents a major welfare gain unreflected in standard economic metrics.
- The Internet Analogy: The modern internet is described as a "Republic of Letters" multiplied 1,000 times, offering unprecedented speed, lower costs, and the ability to bypass national borders, yet a disproportionate amount of high-level innovation still originates from elite institutions (e.g., MIT, Stanford, Caltech).
- Current Challenges: Mokir predicts climate change will become the defining "focus of intellectual activity" for the current era, similar to how smallpox or longitude focused the 18th century, requiring technological solutions rather than purely political ones.
- Structural Holes and Weak Ties: Innovation thrives on "weak ties" and connections across different geographical and disciplinary networks, allowing ideas to recombine in ways that dense, strong-tie networks do not.
- Future Outlook: While the internet creates a more level playing field for unknown creators, the friction of creating high-level knowledge remains, and the "culture of growth" relies on the continued ability to focus human ingenuity on solving existential threats.