Lindsey on the age of abundance

by Russ Roberts on March 30, 2009

in Podcast

The latest episode of EconTalk is a conversation with Brink Lindsey on the ideas in his book, The Age of Abundance. In the last part of the podcast, Lindsey critiques the view that the 1950s were some sort of economic golden age because there was less inequality.

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{ 6 comments }

terminator March 30, 2009 at 1:21 pm

Lindsey falls short when explaining 60s and the rise of the left and right. He is "sort of" on the right track when he talks about agrarian, industrial economies, however he skips to "affluence" from this very fast, ignoring the fact *how* people work and produce effect their culture. An assembly line worker whose job is very repetitive will have different outlook on life than a computer programmer whose job is creative, even if these two people made the same amount of money. So affluence is a side-effect not a primary factor.

The 60s phenomena can be explained by "production method" idea very effectively – the critical year is 1956 when the number of white collar workers exceeded blue collar workers for the first time in America, and US was the first country this had happened. Individualism is directly connected to this seminal event, indirectly to affluence because knowledge based economy has less *friction* and produces more effectively, hence produces more wealth.

The fact that Keynes models blew up in 70s also is directly related to this IMHO – Keynes methods could not predict inflation and unemployment could rise at the same time. This must be directly related to the *new* method of production because this new economy has different rules, much more volatility and does not tolerate any more *direction*. It must and needs to move on its own. I believe Hayek is 100% compatible with knowledge economy because you cannot predict, then you must let the masses must do the prediction for you.

http://thirdwaveiscoming.blogspot.com/

terminator March 30, 2009 at 2:00 pm

I aggree with the nostalgianomics point – the fact that both the so-called left and right want to go back to earlier times and our political system is gridlocked because of this nostalgia. I think babyboomers are frustrated whatever changes they've lived through, things changed EVEN MORE, and revolutionary though they might seem, they still don't understand this brand new world they are in.

terminator March 30, 2009 at 2:01 pm

I aggree with the nostalgianomics point – the fact that both the so-called left and right want to go back to earlier times and our political system is gridlocked because of this nostalgia. I think babyboomers are frustrated whatever changes they've lived through, things changed EVEN MORE, and revolutionary though they might seem, they still don't understand this brand new world they are in.

terminator March 30, 2009 at 2:02 pm

I aggree with the nostalgianomics point – the fact that both the so-called left and right want to go back to earlier times and our political system is gridlocked because of this nostalgia. I think babyboomers are frustrated whatever changes they've lived through, things changed EVEN MORE, and revolutionary though they might seem, they still don't understand this brand new world they are in.

terminator March 30, 2009 at 2:12 pm

Lindsay dead wrong on the demise of the unions. Unions lost and continue to lose power because robotics and automation was introduced in the factory, hence their numbers *decresed* causing a loss of political power. New production which did not require muscle power came about with new technology, with advances on electronics, computers and AI. So unions are not losing power because of "the competitive environment" – this environment is a *result* of the new production method which is more white collar centric, less blue collar centric. It's all about the technology.

RL March 30, 2009 at 5:12 pm

The Age of Abundance? Lindsey has written a history book?

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