Lecture handout: Stagnation*
Activity: Transformative Innovations

Textbook Reading: Chapter 12 (Section 12.3; pp. 413-421)

Key readings:

Recommended audio:

I was saddened to learn recently that same amount of time had passed between the first human airplane flight and the first human spaceflight as between the first spaceflight and 2018 (see here).

Here is an example of a business model that sounds very high tech and contemporary… but originates from the 1930s!!

Here’s a photo of Lady Priscilla Norman on her electric scooter, taken in 1917!

To some extent this lecture is about trying to work out what happened in the early 1970s. This website poses (almost) the same question:

Three weird (possibly related_ facts about this period:

  1. Energy consumption flatlines in the 1970s (great news for environmentalists!)
  2. Number of beards increases dramatically in the mid 1970s (source):

3. EAP (forerunner to ESCP Business School) is founded in 1973

Perhaps people will look back on 2007 and say “what happened??”


The lecture provided some pessimistic views on transformative breakthroughs. But every now and then I notice the power of steady, incremental progress. For example:

Noah Smith has a nice Twitter thread on progress since 1970.

Here’s a great video showing the progress made in car passenger safety:

Learning Objectives: Understand the scholarly literature on the secular stagnation thesis