The 2020s are set to be the most disruptive decade in human history, ushering in a period of economic transformation unprecedented in speed, scale and scope.
Many of us view it through an industrial lens, whereby we may recognise the many challenges we face today as a global population, but nevertheless anticipate a continuation of our way of life—one that is deeply intertwined with the industrial economy. This system, after all, is the one we grew up with, dating back to the 1870s.
The industrial economy, after all, is the system we grew up with, dating back to the 1870s. Organised across a centralised, vertically integrated value chain, it begins with people designing products and services for maximum profitability, who then source stores of natural resources to produce standardised commodities using combustion machinery. These commodities are then distributed through hub-and-spoke networks in manned combustion vehicles, in order to finally be bought and sold at physical retailers in face-to-face exchanges.
The industrial economy managed to propel human progress well beyond the legacies of the hunter-gatherer and agricultural economies before it. Over the course of just 100-150 years, equivalent to 0.001% of human existence, it exponentially expanded real GDP by 50x and global population by 8x, which increased GDP per capita by 11x and average social development by 30x.1 It’s no wonder we remain keen to sustain this system into the future, even in the face of intensifying challenges. It’s no wonder we remain keen to sustain this system into the future, even in the face of intensifying challenges.
These challenges include disruptive changes in the social and environmental conditions surrounding the economy and in the informational and technological capabilities underpinning it, both of which are dramatically different today than when the industrial economy first began.
Changes in conditions and capabilities are the drivers behind exponential human progress over our 100,000+ year history
Taking a closer look at conditions, in 1870, society consisted of just over 1B people living with low levels of development in rural settlements and urban towns alongside agricultural animals. Today, however, we’re 8B people—tightly connected digitally and densely populated physically—living with relatively high, yet unequal levels of development. 2
In terms of the environment, then we were in the Holocene Epoch, characterised by a stable, mild and moderate climate and easy access to abundant stores of natural resources. Now we're in the Anthropocene, in which human activity has become the driving force of nature, evident not only in widespread resource degradation, but also in terms of severe climate volatility. 3
Historical Index of Human Development (HDI)
Select Countries from 1870-2015
The increasing rate of annual carbon emissions (left) is driving global average annual temperatures (right) towards the critical +2°C tipping point associated with negative feedback loops
Changing conditions, however, are just one side of the equation. On the other side are changing informational and technological capabilities.
In 1870, combustion-engine machinery marked the forefront of technological progress. The advent of these simple mechanical systems unleashed the energy concentrated in fossil fuels, freeing us of the limitations of labour from muscle might and speeding up the transmission of information, first by hundreds of horsepower and then to the rate of telephone lines.
Today, however, advances in computing and electronics have resulted in the formation of complex, adaptative systems capable of autonomously harnessing precision streams of resources, whether in the form of energy, materials or information.
While these modern capabilities have been around for decades, what is different today is just how competitive they have become in terms of cost and performance.
This is due to the benefits of experience and scale, captured in Wright’s Law, or the observation that for every cumulative doubling of units produced, costs fall by a constant percentage. At the same time, performance also often exponentially rises. Wright’s Law can become self-perpetuating, as cheaper and better technologies allow for a broader range of applications, increasing production and improving cost and performance once again.4
This is precisely the pattern we’ve seen unfolding over the past few decades, with modern technologies, such as the core suite captured here—computing performance, data storage, solar, batteries, LED lighting, genome sequencing and editing—becoming 100x cheaper in the past 20 years alone.5 And this graph is just a snapshot of a longer-term trend, beginning well before the 2000s and continuing through the 2020s.
Modern capabilities are now highly competitive following decades of cumulative, exponential improvements in cost and performance (Wright’s Law)
Performance has also improved exponentially during this time, such that
If we think about core industrial capabilities, human-operated combustion machines enable us to carry out activity at the level we can control with our senses: what we can see, touch, hear, feel, smell and taste with our natural senses. Digging for coal, corralling animals, writing letters.
In contrast, modern capabilities are enabling us to artificially go beyond our natural limitations to autonomously carry out activity at the precision level of electrons and photons, cells and molecules, bytes, bits and qubits. Industrial performance can't compete with modern performance at this level, particularly not when considering the decrease in cost we just saw.
Bringing conditions and capabilities back together, we see how the industrial system is optimised for the past, not present. As changes in both areas continue to accumulate, they present ever greater headwinds to the industrial economy, threatening its ability to sustain our way and quality of life going forward.
But remember, the industrial lens is just one lens. We also have the option of viewing the decade ahead through a modern lens;
While this system is still taking shape, certain features of the decentralised, horizontally integrated value chain are becoming clear. It begins by designing products and services with Cloud-computing software and then sourcing precision flows of resources. These resources are then produced into diverse outputs locally and on demand in modular, autonomous facilities, for distribution via decentralised networks serviced with autonomous, electric vehicles, 3D printers and other connected devices. Finally, the resulting products and services are bought and sold through A.I.-enabled, interactive, personalised interfaces with full transparency.
Unlike the industrial system, the modern system is not fighting against the disruptive changes we've seen. Instead, it is aligned with them, turning these forces from headwinds into tailwinds.
Returning to the path of progress: yes, we are in a precarious position today. Anxiety is warranted. There is a real possibility we will experience a collapse in our way of life.
But we also have the opportunity to turn weaknesses into strengths by giving rise to the modern economy over the next decade, one that builds on the legacies of the past but advances beyond them.
It is the opportunity to once again exponentially propel progress, but this time from the exponentially greater base of the industrial economy.
The rise of the modern economy has the potential to once again exponentially propel progress, but this time from the exponentially greater base of the industrial economy
Focused on sustaining the industrial economy of the past
Widens the aperture to reveal the rise of the modern economy and the responsibility we have to shape it in line with our values
The rapid rise of the modern economy isn’t a future possibility. It’s happening today at unprecedented speed, scale and scope with no greater example than the response to the global pandemic.
Before the 2020s, mothballing offices or celebrating occasions virtually would have been unthinkable, but distancing measures have driven social interactions onto modern digital platforms.
Similarly, before the 2020s, the standard process for vaccine development was trial-and-error using similar but less virulent biological materials. Today, however, incentives have favoured the use of Big Data software and genomics to develop mRNA-based vaccines in record time at a fraction of the cost. We’ve also mass deployed sensors, drones and smart phone enabled tracking devices to monitor the spread.
This shocking experience has revealed what has been building under the surface for decades. Or in the words of economist Rudi Dornbusch,
Returning to the modern lens, its power lies in enabling us to zoom out on the present moment and recognise how disruptive changes form part of greater pattern of activity. It reveals to us the numerous ways in which changes in conditions and capabilities are crossing key thresholds, becoming ever greater headwinds to the industrial economy and tailwinds to the modern economy. Once we see this pattern--whether in relation to the pandemic, the climate crisis or adoption of technologies--it becomes impossible to unsee. It’s everywhere.
For example, are virtual social gatherings fulfilling? Are novel vaccines key to optimal health outcomes? Does complete surveillance make us feel more or less secure? The modern economy is neither ‘good’ nor ‘bad’, but rather depends on the values we choose to embed.
Just as the ‘Captains of Industry’ during the 1870-1900 Gilded Age made the key design decisions determining our industrial way of life, a small number of people during the disruption decade will make the key design decisions determining our modern way of life.7
And not just that, but also the quality of our lives and of all lives going forward.
From the micro to the macro to the mega level, we are simultaneously resilient and fragile in our interdependency--a wonderous complexity we are only just starting to appreciate.
The view through the modern lens places the present moment in its greater context. It recognises its transformational nature and reveals opportunities to personally shape it with a sense of responsibility and adventure.
These are questions I would love to continue to explore with you in forthcoming presentations exploring different areas of the modern economy and applying a modern lens.
Our exploration of the disruption decade continues with the next presentation in the series soon to be released. Be the first to hear when it launches on the site.
 Roser, M., 2013.Economic Growth. Our World in Data. Available here; ‘Social Development Index’ Morris, I., 2010. Why The West Rules -- For Now. New York: Picador.
 Roser, M., (2021). Human Development Index (HDI). Our World in Data. Available here
 The atmospheric concentration of carbon in the atmosphere was 287 parts per million compared to 413 today; NASA, ‘Global Mean CO2 Mixing Ratios (ppm): Observations’ (NASA GISS, n.d. Global Mean CO2 Mixing Ratios. Available here); NOAA, Global Monitoring Laboratory, (2021). ‘Trends in Atmospheric Carbon Dioxide’. Available here; maps from NASA, 2021. ‘Global Temperature: 1884-2020’. Available here
 Ark Invest, 2020. What is Wright’s Law? Available here
 Computing performance from AI Impacts. n.d. Wikipedia History Of GFLOPS Costs. Available here; and Morris,Kevin. 2014. ‘Toward Ten Tera FLOPS’ Available here; Data storage from Kicinski, A. and Souiri, H., 2019. Forecasting Future Amazon Web Services Pricing. Available here and Komorowski, M., 2014. A History of Storage Cost. Mkomo. Available here; Solar PV fromBullard, N., 2020. The Energy Revolution That Started in 1954 Is Reaching Its Crescendo. Bloomberg. Available here; and Fraunhofer ISE, 2018. Levelized Cost Of Electricity: Renewable EnergyTechnologies. [ebook] Freiburg: Fraunhofer-Institute for Solar Energy Systems. Available here; Batteries from Henze, V., 2020. Battery Pack Prices Cited Below $100/kWh for the First Time in 2020, While Market Average Sits at $137/kWh, Bloomberg NEF. Available here, Kittner, N., 2020. Evolution of Li-ion battery price, 1995-2019. [online] International Energy Agency. Available here and ARK Investment Management LLC, 2018. Lithium-Ion Battery Costs. [image] Available here; LED from EIA. 2014. LED bulb efficiency expected to continue improving as cost declines. Available here; Genome sequencing from Wetterstrand, K., n.d. DNA Sequencing Costs: Data From The NHGRI Genome Sequencing Program (GSP). [online] Genome.gov. Available here; Genome editing from Schwartz, Mark. Target, 2018. Delete, Repair: CRISPR is a revolutionary gene editing tool but it’s not without its risks. Stanford Medicine. Available here
 Molenti, Megan (10 November 2020). Why It’s a Big Deal If the First Covid Vaccine Is ‘Genetic’. WIRED Magazine. Available here
 Economist (December 2014). Self-Made Wealth in America: Robber Barons and Silicon Sultans. Available here