In 2008, global GDP was roughly $50 trillion. It now comes in at $100 trillion. That means it took ~15 years for the global economy to double in size.
Is this a fantastic rate? How does that compare to the past? Are things accelerating or slowing down?
These are all questions that cause some debate.
A big part of this discussion is where things will go in the future. For all the talk of things getting worse, the reality is we are embarking upon a period which could cause another seismic shift in output. Is Web3 going to be the cause of this.
To give a TL:DR, it isn't. That said, it is going to be part of a process that does attain massive change.
Let us look at the economics of the next 100 years.
Game Changers
For the sake of this article, we will refer to game changers. We are going to isolate this to 3 periods, two in the past and one upcoming.
These are massive shifts that altered all of humanity. Since we are only dealing with three, we can see how they are big. What is exciting is there is the possibility that some reading these words could see the next one happen.
So what are these game changers?
These were periods of transition. The first was the shift from hunter and gathers to agriculture. While this might seem like an insignificant event, from an economic productions standpoint, it was huge.
The second was the Industrial Revolution. This had another major impact on humanity, completely altering output.
Economic Doubling
When human lived as hunters and gathers, life was very slow. While this is true for the agricultural period too, we can see how little changed.
In these primitive economies, growth was basically equal to population growth. Since there weren't many technological advancement, we see little acceleration in individual output. Thus, since it took an estimated 2 million years to go from some protohuman to 4 million people, that is the pace of economic growth many go with.
The net result is a doubling of the economy roughly every 250,000 years.
Turning into a society based upon agriculture, saw massive improvements. According to Bradford Long, the noted economic historian of University of California, Berkeley, the doubling time during that era was 900 years. While this is absurd compared to our standards, it was 250x faster than was previously seen.
Which brings up to the modern world. Doing some simply math, we see that we are now doubling at a rate 60 times faster than during the Ag period. The industrial revolution was a period of massive change and we can see it in the numbers.
Game Changer 3
To be a game changer, we need something that radically alters the entire economy. Thus, something that affects an individual sector or industry is notenough. For example, nanotechnology might off great potential but the focus would be manufacturing/construction. This account for between 10%-15% of the total economy. It is significant yet still not large enough.
Ultimately, we are talking about something that affects every industry. Here is where we come up with one solution: labor.
The next game changer is going to have to change the output by labor. This, naturally, gets us thinking about artificial intelligence and robotics. Actually, with our shift into the digital world, it is likely the AI has the greater impact.
How does this tie into Web3?
If we step back and look at the Internet Age in general, perhaps we gain some insight. Web3 is simply an evolution of an ongoing process towards digitization. The Industrial Revolution was not a singular event that suddenly altered the employment make up of society. It unfolded over many decades.
The same is going to be true of the next game changer. We know the internet is an accelerant, radically affecting the industries it touches. Web3 is a new business structure that presents a new ownership model. On its own, this is not reach the standard we are discussing.
However, one of the keys of Web 3.0 is going to be artificial intelligence. This could be coupled with AI. As we move towards a "superintelligence", however that is defined, we could see the acceleration necessary to produce another game changer.
How Would That Look?
We often discuss the Age of Abundance. This is how it breaks down against the backdrop of the overall economy.
If we see a transition over the next half century that mirror the gains realized by the Industrial Revolution, we are going to see another 60x in the doubling time.
Presently we are dealing with 15 years, or 180 months. A similar change as before would equate to the economy doubling every three months.
Let that sink in for a moment.
It is truly mind blowing and to the point that we cannot really comprehend it. However, this is no different than an ancient Roman walking into London in the 1840s. That would have been incomprehensible to that person.
To take it a step further, imagine someone from the 1860s suddenly showing up in Tokyo or New York City today. They would not grasp even the most minute aspects of our economy.
In my view, Web3 is not going to be the cause of this massive expansion. It does, however, play a crucial role in this evolution. Since it changes the ownership structures, it radically alters how we spread the economic productivity across the population.
This is also not without precedent. It is likely not a mistake that the corporation exploded as a business structure over the last 150 years, paralleling the industrial age. This helped to capture the increased output and spread it to more people. All talks of inequality today are laughable compared to the age of monarchs in the pre-industrial age.
Tokenization could be the next evolution in terms of ownership structure. Here we are looking at another way to capture and distribute economic output, something radically different from what we experience today. Of course, this is being resisted by much of society. We know that corporations were a difficult sell to the European aristocratic land owners of the 1800s.
This is what I think is the importance of blockchain and cryptocurrency. We are dealing with a much larger trend, one that could have massive economic implications.
Again, these are developments that takes decades to unfold. We are likely looking at the realization of this, on a large scale, somewhere around 2070.
Some of the younger readers of this will be around to witness that.