Someone I know posted a picture of an empty rolodex today, saying that they'd moved their friends to 'the cloud.' I'm sure you can look at your phone apps and see other things that would've been physical objects ten or twenty years ago. So, that's one way material use has, at least, shifted.
There are two other trends that worry me more. One is visible in the freezer section at the grocery store; a "half-gallon" of ice cream is no longer actually a half-gallon. Many other food items have shrunk. The article's example of lighter buildings is what I view as the same category, something blogger Yves Smith terms 'crapification.' We've now had at least two generations of spreadsheet-wielding MBA's optimizing corporate costs to reduce what is spent on materials and labor. Evidence of their success is showing up across the economy, and politics, and society at large.
The other trend is money supply; One of the chief problems leading to the 2008 financial crisis was that much more credit had been extended than could ever be paid back by those to whom it was loaned. The 'solution' was to have central banks 'pay back' the loans that never should've been made. That put a lot of credit in to the economy, which shows up as economic growth. I'd like to see an analysis of 'economic growth' where the contributions of resources and credit are accounted for separately.
In the EU, shops are required to display the price per <appropiate round value>, i. e. all coffees have a (usually smaller, but readable) Euro/500g price.
There used to be an even more drastic law proscribing certain sizes and disallowing all others. Flour would only be available in 500g and 1kg bags, for example. They got rid of it, possibly because they got sick of people making fun of EU regulations (that's what happened with the famous banana ratings)
>In the EU, shops are required to display the price per <appropiate round value>, i. e. all coffees have a (usually smaller, but readable) Euro/500g price.
Grocery stores in the US do this, but it's not something you necessarily see in food service shops.
> Grocery stores in the US do this, but it's not something you necessarily see in food service shops.
They do an absolute shit job of it, because there are no standards or regulations. Most times I see this, similar items next to each other on the shelf are using different "standard" units making comparison impossible (e.g. price per ounce vs. price per piece). I've even seen two sizes of the same brand/product use different "standard" units on the grocery store price label.
Safeway does this on the west coast. Annoying, not to mention using English/American units that are difficult to convert (how many ounces in a gallon?).
Fluid ounces, you mean. 128. Not a fan of base 2, I take it.
Luckily, my local Publix that I shop at does it quite well.
You're being way over dramatic. 99% of the time the unit makes sense and is the same for comparable products.
That may be your experience based on what you shop for and where you do it.
America is way behind Europe on this. 99% of the time I go to Safeway, I have to bring out my calculator because the reference volume/weight is different from the other items on the same shelf.
When I want to buy cherry tomatoes in German REWE, usually half the varieties have their unit price listed in €/100g, while the rest is in €/1kg. While metric does make converting in your head easy, I bet this still throws off a lot of the non-mathematical people and is done very much intentionally.
Safeway and other grocery chains all list price per ounce next to the price.
Interesting, yeah the Safeways I've been to have all had price per ounce pretty consistently.
What is a bit irritating is having to recalculate when items are discounted.
They usually include the price per for the discounted tag also. Only when it’s a buy x get y free is it hard.
Even with in the exact same product but different sizes I seem them use different units to make to hard to figure out which size provides the best value
That seems odd to me. Wouldn’t the store want you to purchase the bigger product, and thus spend more money?
You’d think it would be in their interest to display the per-unit price comparison, to emphasise where a bigger package is better value.
Only if the bigger product is actually the better value, that is not always the case.
I know of several products that the Mid Size packaging has the best Per Unit value.
And several where they are the EXACT same price per unit, so they want to push you to the bigger one hoping you will waste most of it.
Most stores near me make the lettering very small... if you don't have near perfect vision good luck reading the price per ounce.
It's not consistent. Sometimes they $/lb sometimes they price $/item - for the same class of item.
It's as often design to mislead and prevent comparison as it is to inform you that "store brand is definitely cheaper than name brand".
Since none of it is mandated, they do only what benefits their bottom line or they are publicly pressured to.
They do that in the EU/Germany, too
€/item, €/100g, €/1kg are all common
In 99% this is _not_ a EU thing.
Maybe some German law?? Or just common practice in Germany?
Edit: I think I confused your response with parent. I understand price/kg is a thing although I didn't knew it was mandated by law. What I don't understand is being forced to use some odd unit like price per 500g.
I do not remember ever seeing price per 500g
Yep, every item I see is price per kg. I can't think of exceptions.
In the UK it is typically either per 100g or per kg. Or per litre or per unit. Depends on the category of product.
Its unit price as required by directive 98/6/EC.
A unit is how the product is customarily sold (singly) in the member state.
So for items typically sold as 500g in Germany, all items of that type in Germany would be labelled with 500g as the unit size for comparison. That same product may typically be sold in the UK as 1kg, so in the UK they would use 1kg.
Are we talking about stuff that can vary in size but isn't weighted? Like kiwi's or cucumbers have a fixed price each while apples or bananas have a kg price. But I don't remember seeing processed food without a kg price.
The only time I remember having difficulty comparing was different formats of toilet paper when our usual brand was out of stock... #rolls × #sheets / pack price was a bit to much for me to do in my head. Yeah, I'm not really complaining.
Same in Hungary. Everything has price / kg or litre shown next to the item’s price.
I read panpanna's post as saying that it's not common to have different units, not that there's no price per unit value next to labels.
It's at least law in Sweden since a while.
At least comparing 100g to 1kg is trivial.
It may be trivial, but it can be equally trivial for a manufacturer to to use misleading fonts or units to cause sufficient confusion to increase sales by a small margin. Every label under every product I see has the price per kg preventing such deception.
For accuracy sake, the banana curveness ratings were a lie created by Rupert Murdoch's tabloids.
This was flamboyantly repeated and amplified by the current UK Prime Minister who was then 'journalist' Boris Johnson.
There is quite literally an archive in the European Comission containing, clarifications regarding lies and misrepresentation of facts (the large majority of which created by UK newspapers).
Even if the price per unit didn’t change, when the pack size gets smaller, there’s more packaging per litre/kg.
Although packaging could be thinner, a lot of packaging is to protect from external impact/environment, and remains just as thick, but the surface area to volume ratio has increased.
If I need 3L, it’s annoying to buy 4x 750 instead of 3x 1L like I could in the past.
But the opposite can be true too: a 12 pack of soap may be 12 boxes inside a box...
Is coffee really per 500g? That's a weird quantity. I'd expect kilo or 100g.
The UK used to require bread to be 400g or multiples (so a regular sized loaf of bread is 800g) but it eventually got rid of that rule. Obviously years ago (this rule was hundreds of years old) it will have been some amount in an obsolete unit rather than grams, but once metrication happened the bakers picked 400g as the replacement size. I'm told it got rid of this law a few years back, but certainly last time I bought a loaf of bread it was still 800 grams.
Bread used to always be 1lb (454g) and 2lb (908g) loaves. They shrank a little with the move to metric. :)
"used to be" prior to World War 2. The loaves shrank (and ingredient quality worsened) as part of rationing. After the war better ingredients became available but loaves remained 14oz, which is slightly less than 400g. Conveniently 14oz is not enough under 400g to count as "undersize" in the regulations, so generously filled 14oz tins produced compliant 400g batches when Britain went metric.
Hmm, never knew that. :)
I knew of the Bread Act that set it 1lb/2lb, and the Middle Ages origins that worked "backwards" - when the price of the loaf was fixed and the weight of the loaf was varied as the price of wheat changed.
In some sense that makes much more sense - the people are starving? Well, supply more grain then.
Doesn't quite gel with modern manufacturing, though!
500g coffee packs are pretty much the regular size in Germany too, at least for pre-ground . Packs with whole roasted beans are usually on the bigger end.
Sadly it doesn't translate very well to every kind of grocery item.
Kitchen paper towels and toilet paper can still give you a pretty good math exercise to figure out what's more affordable.
My local supermarket sells their budget fruit brands (which are actually owned/leased from the supermarket itself) as a pack with no actual weight measurement given, so the price is per apple. Every other brand lists their weight and prices are given per 100g, so if you actually want to figure out what is cheaper you need to go weigh the budget brand on the scales and then do the maths yourself!
And when I think about it, those are 2 items I’d like to buy by the kilogram.
I didn't know there was such regulation, and now I wish we could get it back. Not a month goes by without me or my wife noticing another product in the supermarket that lost a few percent of its mass while retaining its price.
This little video of a an 80's desk versus a contemporary one has been bouncing around Twitter today...it's a really great visual showing how apps have slowly been replacing everything that used to clutter a desk.
I love the idea of someone having to use a globe in their job.
A lot of it is due to sticky prices. Customers don't like seeing the number on the label go up, so the companies do what they can to keep the product quality the same at the same price point, which results in reduced quantity. The alternative is to reduce quality, which usually results in a death spiral.
I think consumers would be more willing to see the number on the label go up if they saw the number on their paychecks go up. Wages in the US peaked about 1968, a number of forces have been working to reengineer that deal ever since.
Similar to your point, executives don't like seeing the number on their costs go up. Isn't it possible that quality could take a hit in how the executive chooses to reduce costs?
Nominal wages in the US have most certainly gone up since 1968 a great deal, this much is really obvious. You might be talking about real wages, but those are irrelevant when we talk about sticky prices, because people don't accurately understand the changes in their real wages over time (and those have also gone up, though not as much as some people would expect).
Similar to your point, executives don't like seeing the number on their costs go up.
Yes, but they do go up, so they try to exploit quirk of human psychology to reduce the impact of rising costs on consumers.
Isn't it possible that quality could take a hit in how the executive chooses to reduce costs?
It sure is possible, and no doubt happens with lots of products across the board. Usually, it is wrong move, and the company eventually succumbs to competitors.
real wages have gone up on average, but median wages have gone down. If you're in the business of selling household staples the median income of your customers matters more to you.
Also, a great way to trick people into buying less.
> The alternative is to reduce quality, which usually results in a death spiral.
Or increase cost.
I'm only slightly surprised that a comment full of anecdote without a shred of actual scientific evidence is the top comment in this story.
MBA's have optimized everything... which is great! We don't need to spend incredible amounts on labor. We don't need to buy incredibly large homes. Make work more efficient... its the only way to compete with low cost emerging economic markets. Specialization and efficiencies are the only way to remain competitive.
From my perspective, the only real structural damage has been done by the success of concentrated moneyed interests in regulatory capture. We need to tax these efficient corporations and individuals fairly, and use those tax dollars to invest in universal healthcare, environmental protection and education.
They've optimized for the wrong things-- short-term profit while making the products crappy. For example almost all of the household appliances I've purchased in the past 7 years have failed because of poor design and inferior plastic parts. My expensive oven doesn't have enough insulation around the electronic control and its failed from heat, etc etc.
More anecdotes. While you complain about your Owen, the efficient supply chains built across nations has enabled keeping costs low enough for Americans with stagnating wages to afford a reasonable standard of living.
You can cry anecdotes all you want, but planned obselesence is a highly observed and we'll documented phenomenon. A very cursory Google search will tell you as much.
I wonder if the reason wages are stagnating is that the "efficiency" is a result of skimming off the top, and removing much of the value added by removing people from the process. Maybe appliances failing as soon as the warranty expires introduces market externalities that someone will dearly pay for some day...
Or maybe we are paying for it today! Have you ever heard of the [broken window fallacy](https://en.m.wikipedia.org/wiki/Parable_of_the_broken_window)? Basically, someone may claim that breaking windows increases spending on window repairs, which is a net benefit to the economy. This, of course, ignores what could have been bought had the window not been broken to begin with.
I don't really believe in planned obsolescence if it isn't enforced by electronics. In the 20th century it was common to use metal for things that we use plastics nowadays. Metal is expensive but lasts longer, plastic is cheap but it breaks easily. If you want to provide a cheap product then metal is out of the question. The end result is that we have too many crappy products but that doesn't mean they have been engineered to fail.
One of the big efficiencies they've found though, is that no one prices externalities properly.
By damaging the rest of society in ways that they're not directly accounted for, they find new ways to profit. Many have stayed competitive by costing the human race more that they provide in the long term in many cases.
Who is "they" here? Executives with MBA's? Middle managers? If so, this is true but only in aggregate. If you see private corporations strip mining the environment and society for profits, the Government and regulations are meant to be a check on that.
Then maybe we should focus on fixing the wage stagnation problem, and not kicking the can.
I mean, YES, of course we should. That’s what I’m arguing for. Tax wealth better, use the generated revenue to improve people’s lives in scientifically proven ways (Ie provide healthcare, poverty assistance, more funding for education). Let’s accept that our world has changed, but let’s use the benefits of that efficiency by building a more equitable and just society.
But we won’t. Most societies that become too successful suffer a similar fate. They become too polarized, and destroy the very foundations of what them great.
I do hope the US is different. Most of humanity has lived under authoritarian rule. For a brief period of time it seemed like a democracy could be the most powerful country in the world. But that’s fast unraveling...
Are you suggesting that scientific evidence for product shrinkage or for an increase in the money supply can't be found, and so my arguments have to be anecdotal?
> increase in the money supply
There is scientific evidence for this, yes.
> scientific evidence for product shrinkage
No. The term "product shrinkage" itself is undefined, or poorly defined. You're saying the digitization of services has rendered unnecessary a lot of material needs. Counterpoint: it has enabled commercial transactions on an unbelievable scale, enabling smaller industries to reach wider audiences.
Just because you mix in a fact with an anecdote doesn't make the whole argument better :)
The research referred to in the article is my evidence for what I called 'product shrinkage' and what the article calls 'reduced material needs', namely:
He had found substantial evidence not only that Americans were consuming fewer resources per capita but also that they were consuming less in total of some of the most important building blocks of an economy: things such as steel, copper, fertilizer, timber, and paper. Total annual U.S. consumption of all of these had been increasing rapidly prior to 1970. But since then, consumption had reached a peak and then declined.
The rolodex and the ice cream were just examples to ground the idea. I'm sure there's more to the story than spreadsheet-wielding MBAs, but I think it's reasonable to claim (and evidence can be provided for): 1) Spreadsheets have been used for two generations (VisiCalc, 1979) 2) MBAs are trained to optimize things like capital and labor costs, including the price and quantity of materials used in the products and services they manage.
“Optimizing” so you’re labeling is lying about how much you food your selling is not optimization, it’s fraud.
Making products as low quality as possible is simply destroying your brand. It’s not actually optimizing for efficiency or anything but how effectively you can trade brand loyalty for some quick cash.
Sure, it’s easier to try and cheat your customers than actually improve efficiency and our compete your competitors. But, that’s a long term losing strategy.
I don’t think there is any substance in this comment which makes it hard for me to give a good response. Try better next time.
> ”a "half-gallon" of ice cream is no longer actually a half-gallon. Many other food items have shrunk.”
This is a common phenomenon in the UK, and there’s a name for it: Shrinkflation.
It’s a way to raise prices by stealth by not actually changing the price, but by shrinking the product instead.
'That put a lot of credit in to the economy, which shows up as economic growth.' - Unfortunately its not quite true!
Fractional reserve banking (FRB) as is taught in most econ textbooks and courses is a myth. There's a very nice paper by the bank of england debunking this (Money creation in the modern economy). The idea behind QE and bailing out the banks was to create lending and liquidity in the market largely via the FRB mechanism however that failed to materialise for reasons the bank of england paper goes into but basically banks don’t lend out their reserves as the theory expects but it’s the process of lending that creates deposits not the other way around. The money given to banks didn't result in increased lending but instead went into financial markets buying up assets. There was some wealth effect going on so people with some assets got richer and then spent more but overall it was a really trickled down effect.
> The money given to banks didn't result in increased lending but instead went into financial markets buying up assets.
This statement is precisely what I meant by 'put a lot of credit in to the economy, which shows up as economic growth.' The trick is that QE took the bad mortgage loans (which are created as you say, loan first, not deposit first) off of the banks hands, and put real Fed-created money in the place of the loans (around 1.5-2T of QE went to mortgage-backed-securities.) That converted the bad loans into good credit, then used in the way you describe.
> There are two other trends that worry me more. One is visible in the freezer section at the grocery store; a "half-gallon" of ice cream is no longer actually a half-gallon. Many other food items have shrunk.
A half-gallon seems like an absolutely obscene volume of ice-cream. That's over two litres! Why would anyone possibly need ice-cream measured by the gallon? Isn't it good that sizes are reducing from that much?
You don't eat all the ice cream in one sitting. If this random ice cream is an indication, serving size is half a cup, so a half gallon should provide 16 servings. If you like the flavor, why not buy 16 servings at a time; if you live in a household with four people, that's 4 sittings of ice cream.
In the UK I don't think even the largest ice cream comes in more than 1 litre. Most is around 0.5 litres. And even that for a family seems like a hell of a lot of ice cream. One litre is a crazy party volume of ice cream. A half-gallon sounds absolutely bonkers.
Of course, with as much air as comes in the ice cream here, a half gallon is probably only a liter of actual ice cream. They definitely don't weigh nearly as much as they look like they should.
You need air in the ice cream. Ice cream without air is frozen flavored cream and you'd need tools more substantial than an ice cream scoop to serve it. The manufacture will vary the air content to dial in a particular hardness.
Ice cream in Australia is available in 4L tubs down to smaller tubs for premium brands or more exotic flavours. Doesn't seem excessive given it (ideally) takes over a week to get through.
>You don't eat all the ice cream in one sitting.
Kinda like how you don't drink a twelve pack in one night?
Maybe you don't
A half-gallon is slightly less than two liters, and is not intended to be one serving. Its a bulk purchase to serve a family, usually multiple times.
(Although I have eaten one in one go when I was a young man.)
But why are people buying a rare treat like ice cream as a bulk item to eat repeatedly? Seems like something we want to discourage?
a) when you split it over four people it's only ~two evenings worth of desert.
b) don't tell me what to do with my body.
Besides the fact that American portion sizes are generally larger, with the related implications to health and food waste, a half gallon of ice cream is usually for many people, like at a party.
When I was a kid, we'd buy whole gallons of ice cream, and that would last us at least a week!
The same is true of coffee. A 1 pound coffee can is the same size it always was but now has 10 or 11 ounces of coffee in it.
This is especially annoying when you realize that ever brand is different. There will be seven different brands of coffee in identically-sized bags, yet one may have 5.7oz of coffee and another will be 12.8oz.
Is it possible they are trying to sell for the same price but with wildly varying costs of each varietal of coffee? I.E. they want to sell a bag for 15 bucks across the board but some beans cost them far more than others to source?
It still seems purely disingenuous to package them deceptively to appear to be the same quantity.
Up to some value of volumeDelta * productCount it actually makes sense to use the same container due to sourcing/manufacturing cost from the variance so I wouldn't say purely disingenuous, there is real reasoning behind some of it... it's just marketing gets in the way of when you should actually add that second container size i.e. it's costing you more to always use the bigger container but the marketing department says the increase in sales due to confusion outweighs it.
So then why not just keep putting the same amount of coffee in the can?
It's on us though. They're lying to us to get our money, our labor, our consent. We let them.
Because demand curves don't work like that unless you have a highly inelastic good. With normal goods keeping quantity constant as price changes puts you on a suboptimal point on the demand curve. Coffee's price certainly hasn't been inelastic and changing can size at every spike would have netted you decent production cost increases instead of savings: http://www.aboutinflation.com/_/rsrc/1368022029715/coffee-vs...
The varying of quantities in the same sized container is not the problem and is certainly not illogical. The problem is when we allow marketing departments to lie/cheat/fool the product onto a different portion of the demand curve instead of letting the $/amount naturally flow back when price decreases or when it makes sense to switch to cheaper containers.
Because it pays, and for some reason not many people have the guts to say marketing is rotten to the core, and advertising is cancer on the society. Maybe because the market encourages it structurally. Lying costs little and yields good profits, so acting immorally gives competitive advantage.
This is why I prefer buying bulk when I can (with reusable containers/bags ). Bulk Coffee + airtight/cool storage hasn't resulted in bad coffee for me.
Why put up with deceptive packaging?
 Yes I know that most of that product came arrived in even more packaging, but doing what I can for now.
I guess what I am learning about myself lately is that I have the power to lie to people and convince them to do things they don't want to do or don't know better.
People know this about me. They know it almost instantly. I sense it in them.
I sense the same about other people. They have that power over me.
However, I make an effort not to. Or, when I do, I work especially hard to steer them in the direction of their goals or somewhere that will benefit them. Even if it's at my own expense sometimes and that can be sad or disappointing.
And so, through that, I have come to resent people who don't think that way. Who think, "People won't look at the number of ounces in the can, they'll just see it's the same size and think they're getting the same amount."
It's a lie. Deception. It's wrong.
But yet, we allow it in society.
It's destroying us. It's all around us. Fake news. The US President. Marketing. Stack Overflow.
So, why put up with it? It's not that you even know you're putting up with it. Some of us do. Most don't. Scammers proliferate.
It's more like, How do we protect the innocent people? Why as a species, do we allow some of us to prey on others?
It doesn't seem good to me.
I stand with you here. I recognized something like this myself - I phrase it as "I want to live in a world of cooperation, of win-win deals", but there are still people who prefer to exploit others, play "win-lose" games.
That's why I despise the advertising industry so much. They're all playing win-lose games with society, and the collateral damage slowly eats at the base of what keeps our societies together.
Yes! I remember someone asked me one time, "What do you want?"
I said, "I want to create synergistic relationships with other people."
I despise advertising too, but I realized I have to advertise so people know about my products. There are people who want them. Advertising helps them find my products that solve their problems.
And then I realized the advertising platforms like adwords and such were also deceptive. So I stopped advertising.
It doesn't help me though or the people who I could help if they knew.
Like almost all big problems of our times, this too is a coordination problem.
When everyone around you shouts through a megaphone, you need a megaphone too just so that the person next to you can hear you. If someone took all megaphones from everyone at the same time, people would have the ability to finally have a conversation.
Advertising currently is this. It's oversaturating our attention. Of course, for a market to function, you need a way for people to know what's available to buy. If done honestly, it's totally fine, and I don't have anything against it. My beef is with the existing industry, with all the things I've mentioned here. I want someone to take their megaphones away, so that we could talk to each other like human beings.
I'm interested in your thoughts on one public policy example of this. Back when AIDS first hit, the community of scientists and public policy makers said that while it was starting in the gay and drug community any moment it would hop into the general population. They knew this was a lie, but told us this because they didn't believe Americans would spend money helping gays and junkies.
I've come to understand that to varying degrees a lot of public policy works this way.
I don't think that was even a lie - disease doesn't respect tidy social boundaries of guilt and innocence. Especially with unscreened blood at the time.
Yeah, I don't think it was a lie either. It was an expectation about the future. We worry about diseases jumping demographics all the time, sometimes even from one species to another.
Thank you for saying that. Conditioning on this being accurate information, I just lost that much trust in the community of scientists.
This is how "hacking" the public policymaking fucks up society. And then people are surprised antivaxxers are a thing. They are a thing because we're all being constantly manipulated, and some people just don't have the capacity or patience to separate the truth from bullshit.
How can one even lose trust in "the community of scientists"? It's such a vague concept.
WRT. "the community of scientists", I was just parroting the expression the comment I replied to used. I primarily meant medical reporting and its public policy implications.
What's Stack Overflow deceiving us about?
It goes back to the very beginning:
> Stackoverflow is sort of like the anti-experts-exchange (minus the nausea-inducing sleaze and quasi-legal search engine gaming) meets wikipedia meets programming reddit. It is by programmers, for programmers, with the ultimate intent of collectively increasing the sum total of good programming knowledge in the world.
The key part is "minus the nausea-inducing sleaze" except that their behavior of late is exactly nausea-inducing sleaze.
>Atwood was bothered that the community doing all the work wasn't getting paid...
Yet, the contributors to the stacks don't get paid either. Now the creators and VC are trying to sell the stacks and make money -- exactly what he said his competitor was doing and shouldn't be.
> He and Spolsky decided to create an ad-supported free alternative, and released all answers under a Creative Commons license, so that the users could use the content elsewhere if Stack Overflow ever shut down or started charging for subscriptions.
Now they've decided to retroactively change content users created for them to their benefit.
> we will continue forward under version 4.0 of the CC BY-SA license. This change encompasses all Subscriber Content as described in our ToS including data dumps as well as any content previously made available by Stack Exchange under the terms of version 3.0 of the CC BY-SA license.
You may have missed a lot of recent drama, some of which involves deceptive advertising practices.
Coffee goes stale very quickly. I wouldn’t do that if I were you.
> We've now had at least two generations of spreadsheet-wielding MBA's optimizing corporate costs to reduce what is spent on materials and labor. Evidence of their success is showing up across the economy, and politics, and society at large.
Or on other hand we are enjoying more from life with less resources. Not only it helps more companies to be more profitable thus keeping more people employed, it also does a great service to the planet and the future as we continue to reduce our footprint.
I agree with your point about the loan paybacks which of course is off topic.
It is not "crapification", my take on is "replaceability". People hail washing machines from communism era as really good, working for 30 years (they don't take into account survivorship bias but that is another point).
Earlier you could afford only one pair of shoes for your entire life. Lots of physical things could be inherited because they were valuable and they were really expensive.
You would not let your kids inherit your shoes now. The same with buildings. Kids will probably want to have their "own dream house" not stick with their parents dreams. Those kids probably will also have to move to other state or other city because jobs their parents did will no longer be there, and they will have to find their own place to get a job. Son of a carpenter is not going to be a carpenter. You want buildings easily replaceable. Buildings should last not more than 100 years and be easy to recycle.
That said, all stuff that would be replaceable, should also be easy to repair
Exactly. And we have that magnesium and other macro-nutrients are declining in fruits and vegetables (https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6163803/). Unregulated capitalism will grow "food" in the form of apple shaped buckets of water and sell as many as they can as the soil is exhausted.
From the article: It suggests that economic growth in a mature economy does not necessarily increase the pressure on the world's reserves of natural resources and on its physical environment.
Jesse Asubel has been looking at "dematerialization" for a long time but it has only been relatively recently, now with a couple of decades of additional data to look at, that it is getting the attention I think it deserves.
One of the consistently annoying things, for me, in science reporting is the extrapolation of a given set of ratios out to some point where the result is very click-baity. The systems guy in me has experience that all exponential trends are s-curves, and so I feel that one must at least acknowledge that fact in your reporting. I understand it, it means that the predicted outcome might not happen at all, but it is important to the story.
So economists do the same thing, they take some ratio of numbers that seem to be tracking the 'size' of the economy and then run that trend out 50, 100, 500 years. It really doesn't matter, but what is important, and this article and other papers on de-materialization have demonstrated, is that neither the economic growth rate, or the relationship between that growth rate and some other factor, are ever really constant. Thus any point that depends on them being constant for more than a decade or so, is really stretching it.
Its nice to see this reality (of how extrapolating is bad because things change) demonstrated in a clear and convincing way.
 "Materialization and Dematerialization: Measures and Trends" -- https://www.jstor.org/stable/20027375?seq=1#page_scan_tab_co...
> So economists do the same thing, they take some ratio of numbers that seem to be tracking the 'size' of the economy and then run that trend out 50, 100, 500 years.
Very few academic economists do 30+ year extrapolations, let alone 50, 100, 500. The vast majority of long-term growth macro-economic literature are attempts to explain/model the large observed differences in outcomes in GDP/capita between different countries, and hopefully distill some useful policy advise from that. Forecasting beyond even 5 years or so is a very niche activity in academic economics. (Source: PhD economics and former model builder for pension fund and souvereign wealth funds)
Fair point, I withdraw any assertion that in published papers economists over extend their numbers. It has been my experience that in the reporting on those papers I have seen much less restraint. And yes, I'm aware that survivor bias may mislead in this regard.
Buckminster Fuller made a similar observation or prediction even earlier, in the late 1930s. He called it ephemeralization, https://en.wikipedia.org/wiki/Ephemeralization, the idea that increasing technological efficiency will allow us to do evermore with less.
A possible counter-acting force is Jevon's paradox (a generalized economic form of Wirth's Law) but the linked empirical result suggests ephemeralization is the stronger force. Although, it is likely true we can do much more to counteract Jevon's Paradox like phenomena.
The Jevons Paradox  is named a "paradox" as it is an unusual, apparently contradictory outcome. It can be considered a special case of the rebound effect  where the rebound is greater than 100%. Unlike rebound effects in general, a Jevons Paradox is not a routine outcome of any new technological efficiency gain. It is something that needs to be observed from data rather than assumed.
In my experience, the Jevons Paradox seems to be more widely brandished than understood in internet debates about energy and resources . If Alice claims e.g. that American electricity production is getting more efficient, Bob may "refute" her point by citing the Jevons Paradox without mustering evidence that the Jevons Paradox applies to recent trends in American electricity consumption.
 Your comment did not misuse the Jevons Paradox. You noted that ephemeralization seems to be winning.
There is a vast pent up global demand for electricity around the world. Africa needs electricity, China needs electricity, India, etc.
The world is changing but at the moment that electricity largely comes from burning fuel. And if it makes sense to mine fuel when the payoff is X, then if still makes sense when the payoff is X + something (as it is when efficiency improves).
It is a very safe assumption that Jevons's paradox applies to electricity consumption, there is no need to show it. Take a look at US coal production . There is no evidence there that energy use from coal will decrease with improved technology. That is 150 years of technological innovation and we're basically seeing a linear uptrend in use. If domestic use levels off there will be exporting. That production is not going to go down without an uneconomic political intervention or literally running out.
Now I'll agree that Jevons's paradox does not apply to everything . But energy in general and electricity in particular it is painfully obvious that there are more potential uses than there are efficiencies in the world. Give me cheap enough electricity and I can do anything; its use will not be suppressed by reducing need for it in specific cases.
 Also my name isn't Bob.
The decline of US coal production is right there in the page that you linked to:
American coal production peaked in 2008 at 1.172 billion short tons. Domestic use peaked in 2006 at 1.150 billion short tons. As of 2018 those numbers are down to 0.755 and 0.678 billion tons short tons respectively.
The EIA's latest Short Term Energy Outlook predicts that total US coal production for 2019 will be 0.679 billion short tons and for 2020 will be 0.603 billion short tons, 48% below the peak.
If you look at the "components of annual change" graphic in the EIA report, you can see that coking coal (used for making steel) is up slightly from 2017-2020. It's coal consumption for electric power that is in persistent decline.
Coal supplies about 25% of American electricity in 2019 and is expected to decline to 22% in 2020:
Percentage-wise, coal reached its all time high in the mid-1990s, at over 50% of American electricity generation:
The Jevons Paradox observes the introduction of more efficient technology in an existing system but finds a "paradoxical" uptick in input consumption. The introduction of more efficient coal burning machinery in England was followed by higher coal consumption. That surprised Jevons.
The broadening of energy use (e.g. India developing like England did) certainly also increases demand for energy inputs, but it's a different case than the Jevons Paradox.
Which is meaningless unless you believe that energy efficiency has only happened in the 2008-2018 period, which is not true. I happened to be working in the coal industry for most of that time and the decline isn't because people are using 40% less energy. It has nothing to do with increased efficiency. It has to do with:
1) Political action.
2) Alternative energy sources getting more competitive. Particularly natural gas, renewables and US shale oil.
You're arguing that use-of-energy efficiency can cause a decline in coal production. That is wrong; if you use energy more efficiently I'll mine more coal - I've met the people who make that sort of decision. Coal is declining for other reasons - mainly that alternative sources are getting cheaper (which is not using energy more efficiently).
I did not say that greater efficiency in coal use was the cause of US coal's decline. My last post was contra to:
Take a look at US coal production . There is no evidence there that energy use from coal will decrease with improved technology.
There is ample evidence that improved technology is driving declines in American coal use/production. The combined cycle gas turbine made it possible to extract more electricity from a megajoule (thermal) of natural gas than a megajoule of coal. Hydraulic fracturing made natural gas cheap in the US. Improved technologies and economies of scale made wind and solar electricity more efficient and cheaper. These are all electricity production technologies. They are what what I had in mind with my up-thread Alice and Bob example. US electricity production is getting more efficient (more electricity per ton of material inputs consumed); Bob believes that any efficiency increase must be more-than-offset by increased electricity consumption, and exclaims "Jevons Paradox!" before even reviewing the numbers.
I was just going to mention Ausubel. He gave a great talk for the Long Now a few years back. Video here: http://longnow.org/seminars/02015/jan/13/nature-rebounding-l...
> The systems guy in me has experience that all exponential trends are s-curves
A friend of mine visited a financial planner inquiring about saving for his children's university education.
The planner took the last the last 20 years of education inflation and extrapolated it out 15 years, and recommended my friend put away 2.5k per month today per child today to cover it.
My friend didn't hire the planner, on the reason that we will probably be post-revolution (which would cause this curve to become an S) before we get to the point where you need to save 30k per kid per year over 15 years to pay for university.
Did they consider that the USA send all their production to China due to cheap labor and few environmental regulations? Now they are consuming more but using less raw materials. Compare the number of toys that a child has today to one 30 years ago.
> all exponential trends are s-curves
What does this mean for the stock market? And debt? Or really, what does an economy look like when it's done growing, but stable?
Look at the Japanese economy for an example of stability without growth.
> Its nice to see this reality (of how extrapolating is bad because things change)
...but when they do that same thing on earth temperature everyone loses his mind
"Gee, why is there a pool of water on the floor ever since the rain started? Do you think maybe the roof is leaking?"
"Don't be silly! Just because there is water dripping from the ceiling doesn't mean there is a leak in the roof. Things just get wet sometimes. I'm sure there's a wonderful explanation besides the roof leaking. No sense in hiring someone to come look at the roof either. That would be a waste of resources."
case in point - did I say I am not believing that climate is changing? but no, as soon as one contest the wild exponential predictions, he gets scourged.
The pessimistic outcome of climate change isn't "wild exponential predictions", though. There are well-understood mechanisms, the margin for temperature increase beyond which modern society collapses is pretty thin, the exponent comes primarily from our economy which has an assumption of exponential growth built-in and will collapse if it suddenly turns into s-curve, and we also have a model of a runaway warming feedback loop as our neighbor in the Solar System.
Also worth remembering is that climate change isn't really about climate. It's about our society. Earth doesn't care about temperature, and life on Earth will happily survive whatever we can possibly throw at it this century. All that matters is that climate change puts pressure on societies around the world, and with enough pressure our entire civilization will collapse, and you and me and everyone else we know will die a horrible death.
 - There are also environmental feedback loops ready to take over the growth of average temperature that have gained attention recently.
What climate change effect  do you think will cause societal collapse or result in mass horrible deaths?
Hundreds of millions of people migrating from areas that become uninhabitable from sea level rise and increased temperatures, trying to get into any country that's less affected. Europe just almost tore itself apart over few million war refugees, imagine 100 times more people, with nothing to lose and a valid argument that it's all our fault they don't have a home now.
Food pressure, as arable land is lost to the sea and temperatures, plus collapsing ecosystems as insects and plants with high vulnerability to temperatures die off. Food prices increase, risk of food shortage increases too, and so does social unrest.
As some land is lost, other land becomes available, "defrosted" by the changing climate. With reduced agricultural capability and migratory pressures, nations will want to compete for both that new land and resources available on it. This could lead to war.
I could elaborate, but let me instead tell you to look at the problem in reverse: think of how little it takes to cause "mass horrible deaths". Most people live in cities now, and most cities are fed "just-in-time", which means there's 3-5 days worth of food in them. Imagine what happens if you break that supply chain for more than a week. Imagine this happening to multiple cities in a country simultaneously.
 - You can't e.g. think that a +4°C Poland can just switch from wheat to bananas. Bananas may like the new summers, but won't survive the winters.
> For example, at the end of the last ice age, when the Northeast United States was covered by more than 3,000 feet of ice, average temperatures were only 5 to 9 degrees [Fahrenheit] cooler than today.
If 4 degrees Celsius of global cooling (relative to the current climate) can cause large parts of the US to be covered by 3,000 feet of ice, then it's not unreasonable to think that 4 degrees Celsius of global warming could have an equally destructive effect on agriculture and society.
The heat-trapping behaviour of CO_2 was first accurately measured in the 19th century, and all climate change models do actually predict convergence, not linear rise. It's just that the point of convergence is not one compatible with civilisation as we know it.
Exactly. If global warming said the typical outside temperature in Seattle doubles to almost 600K then it'd be fair to argue that's crazy people extrapolating - water isn't even liquid at that temperature, no model we have could make sense. But actually the model says it will go up say 2 or 3K. Much less like a wild extrapolation, and unfortunately still completely terrifying because that is already far too much.
2 or 3K really isn't enough for Seattle.
How does anyone know what temperature rise is or isn't compatible with civilization as we know it, within the range of predicted temperature rises? One of the problems is that civilization is dynamic. New technologies come along, people change their habits, etc.
The effects of temperature rises on crop yields could lead to very negative outcomes, given expected population growth and the hard limit of humans' minimum caloric intake.
Perhaps rich countries can mitigate the likely increase in food prices, but it could destabilise large regions of the globe.
Some people say growth can't happen forever, and all growth comes at environmental cost, but that simply isn't true. I can create digital goods and services which people buy, and this increases GDP, and it doesn't hurt the environment and is indeed economic growth in the realest sense. I can even give massages all day, and this also doesn't destroy the environment.
This is incorrect. Every economic output requires material inputs.
> I can create digital goods and services which people buy
Your digital goods and services require physical machines to run on. These machines are made of physical materials, including some rare earth minerals that are costly to extract. These machines require energy to run, which also requires material inputs.
> I can even give massages all day, and this also doesn't destroy the environment
Human beings like yourself require material inputs to live – food, shelter, energy, to name only a few. Just by being alive on a biosphere, you are impacting the environment in some way. The size of that impact depends on your individual lifestyle.
There is simply no such thing as "immaterial" economic production.
> This is simply incorrect. Every economic output requires material inputs...There is simply no such thing as "immaterial" economic production.
Parent post was talking about marginal cost of production. E.g. where once we'd buy servers to run services on, we now share servers rented "by the cycle" from providers who amortize the cost over many users. Idle servers can be running at-the-moment economically valuable code for others. It's even possible that some economically valuable computation I might cause to be performed could consume an immeasurably small amount of power compared to the server sitting idle.
Your formulation reminds me of the "labour theory of value" (https://en.wikipedia.org/wiki/Labor_theory_of_value).
i'm partial to the labor theory of value, not for pricing (which is better modeled with marginalism, as you speak to), but for an intrinsic value by which we can evaluate how well a particular market might be working. a well-functioning market should tend toward the intrinsic (labor) value of a good (if, for example, relevant information is widely available and known, competitors can easily enter and exit, distortions are minimized, etc.).
How do you determine if the market price is tending toward the labor value of a good if there is no clean way to map from labour-hours to prices?
that's the whole point though. price can be highly decoupled from cost, which i'm positing is a signal of the magnitude of the distortions in a given market.
but to your question, you'd just "measure" price as the prevailing price that you see in the marketplace, and labor is measured as the aggregate cost of all labor inputs, including parts and raw materials and amortized capital costs. in a well-functioning market, you'd expect prices to trend with the labor value. the industry profit percentage would then be an reasonable expression of the riskiness of the market/industry (in drug discovery, it might be 50% but in grocery, it might be 5%).
so for example, if apple sells iphones for $1000 but it costs them $400 in labor to make and sell, their labor-price markup would be 250%. in a functioning competitive market, you'd expect a competitor like samsung to pursue those profits and, as a result, eventually drive prices down.
You haven't rebutted the parent poster.
He said "Some people say growth can't happen forever, and all growth comes at environmental cost". Pointing out that "Every economic output requires material inputs" doesn't mean that there are limits to growth or that you can't have growth without environmental cost.
As an example, if you have a resource that you consistently get more efficient at operating, you can consistently use it to provide more and more value to the world (economic growth).
To use his example: if you take a human who would be using material inputs like food, and instead of them engaging in activity that did not provide value to society, they spent their time giving people massages, you have not increased the amount of physical resources being consumed (since the person was otherwise using the same amount of resources, just not doing anything of value).
This is an accounting trick, though. It works because people are willing to pay for a massage and not for whatever the person was doing. But to actually grow the economy, you have to continuously retask that person to ever more profitable activities.
You can also create growth by moving money in circles increasingly fast. Question is, how far we can push bullshit jobs before people get fed up with it? I'm not convinced that "forever" is the answer.
It's not an accounting trick. Different ways a person spends their time genuinely provide different levels of value to society.
If a doctor spends his time saving lives or spends his time watching television, the impact on the world's material resources isn't that different, but the amount of value to society is much greater if he is saving lives.
Again, to have economic growth you actually have to have growth. Once you get everyone doing the things that yield maximum economic value, you no longer have growth. You'd have to make more people (exponentially, under current economic regime), which costs physical resources.
As an aside, when talking about economic growth we're looking at economic, not social value, and it so happens that saving lives is one of the less valuable things. You can determine it by looking at the paychecks of doctors or ER personnel.
A desktop from a decade ago can still run productivity software, especially if you run Linux or another operating system that doesn't cut off support for non-technical reasons. It is true that some physical resources are going to be required e.g. electricity - but in general we are wasting tons of precious resources building "disposable" devices like cell phones that are used for only 2 years to do tasks that have little economic value. If we actually used hardware for more of its usable lifetime, we could greatly reduce long-term environmental costs.
>but in general we are wasting tons of precious resources building "disposable" devices like cell phones that are used for only 2 years to do tasks that have little economic value.
This is wrong in two ways. 1) Cellphones don't just last 2 years; lots of people have older models. Sure, a bunch of people get rid of theirs after 2 years, but then they go to the secondhand market, where people like me buy them for a small fraction of their original price and keep them for another year or two before reselling them. Frequently, older phones eventually find their way to developing nations where people can't afford the latest iPhone. Your argument sounds like someone whining about people leasing a car for "only" 3 years; what do you think happens to cars after the original owner trades it in?
As for "little economic value", that's just plain ridiculous. Smartphones have enabled all kinds of things that just weren't possible or easy before: managing your bank account remotely, sending money to people (e.g. Venmo), GPS navigation, communicating without playing telephone tag, etc. And they do it with much less energy than any PC uses.
> 1) Cellphones don't just last 2 years; lots of people have older models. Sure, a bunch of people get rid of theirs after 2 years, but then they go to the secondhand market,
Increasingly less so. On one side, you have cheap subscription plans that bundle usable (not too decent) phones, on the other hand, phone life is shortened by a combination of planned obsolescence, software bloat, and lack of security updates. Short sales cycles is what manufacturers plan for and actively work towards.
> Frequently, older phones eventually find their way to developing nations where people can't afford the latest iPhone.
I might be wrong, but I'm not convinced. Shipping costs money, phones are cheap, and both battery and flash memory have pretty short lifetimes now. A good chunk of phones are barely operational after 2-3 years.
RE benefits of smartphones, it's all true, but you can't run economic growth on it forever. Smartphone transformation happened. It's mostly done. Itself it won't fuel further growth. Production of hardware and software might, but that is not free in terms of energy/resources.
I have a stable of Android devices for compatibility testing. All of the handsets are still working, even the 2014 ones. But I don't expect you to treat my anecdotes as data!
Report: "Strategy Analytics: Average U.S. Smartphone Upgrade Cycle Now 33 Months"
Smartphone upgrade cycles have been steadily lengthening for years, which has important implications for smartphone vendors and wireless carriers alike. Slowing unit sales have led companies like Apple (NASDAQ:AAPL) to pivot toward subscription services in an effort to better monetize all of the devices that are already out there. ...
The slowing replacement cycle makes sense to me, for basically the same reasons that I don't upgrade my PCs nearly as fast as I did in the 1990s. The improvements aren't as dramatic from model to model or year to year. I'll keep using my current phone as long as it works, which looks to easily be 4+ years.
If phone manufacturers are deliberately trying to drive shorter replacement cycles, it's not working, at least not in the American market.
I have anecdotes to your anecdotes. Seen or used lots of Android devices that "wear down" under day-to-day use. The battery goes first, but flash degradation seems to be a thing too. And of course software bloat.
The report looks interesting, and switching to service model seems like a plausible explanation.
While your point is true on a basic level, I think The parent’s point is on to something.
There must be a level of economic production that falls below the level of emission that can be absorbed without contributing to climate change. Furthermore in <1billion years everything on earth dies anyway (due to an expanding, ageing, sun) - so it is sustainable to use <1billionth of non-renewable resources.
> There must be a level of economic production that falls below the level of emission that can be absorbed without contributing to climate change
You're right, there absolutely is such a level. The important point is that to stay at or below that level, you have to give up on the idea of perpetual, infinite growth. The inputs and outputs must remain constant.
My point was that there's no such thing as "immaterial" growth, so we can't escape this limitation by making a bunch of apps forever.
There is indeed perpetual growth. As long as the economic transaction benefits both of us, as all non-coercive economic transactions are, then the result is net-positive. This is why free trade is a good thing - we decide to trade because it benefits both of us. If trading resulted in a loss for one of us, we wouldn't trade.
To have economic growth, you have to actually grow the amount of trade being done. Can't see how you could do that forever - despite the best efforts of advertisers and companies engaging in planned obsolescence, who are largely responsible for the climate shitshow, people will at some point hit a consumption limit. You can play accounting tricks on GDP to some extent, but I'm not convinced this is enough. If value becomes completely detached from reality, people may lose faith in money, and the whole thing will just crash and burn.
Without growth above the population growth, life becomes zero sum or negative sum.
That means that taking and fighting becomes more rewarding than building.
It is either growth or war, no way around it.
Or simply reach peak population growth which is a common occurrence on the small scale. With population at a steady state, there is nothing GDP needs to outgrow.
If population is steady,GDP still must grow. Otherwise, most of the people who get ahead/gain a better life will do so at the expense of another. That is not a nice world to live in.
Except interest rates. Things would be nicer if our economy didn't depend on paying back interest with economic growth.
Why would a business need the loan in the first place if it doesn't expect a return?
>Every economic output requires material inputs.
They didn't argue that it didn't and that fact doesn't prevent perpetual growth. You can do more with less.
It does though. Proof (if you want to call it that, I accept it is not formally valid) via contradiction:
There is the immaterial economy which which might theorize can perpetually grow.
There is also the material economy which is rooted in real physics - ie, materials, energy (it will always take some energy to heat up water and prepare food, for instance). Can we rule out that buying metal and building material become completely free? Or that the cost of energy will be reduced to zero? If there is limited supply, there must be some cost and if that cost is too low, someone will buy it up, corner the market, and start charging the correct price.
If so, the material economy cannot grow forever (outside inflation, which is not real economic growth).
If the material economy cannot perpetually grow, but other parts can, then eventually that part of the economy will completely eclipse the non-material economy. As the part that perpetually grows goes to infinitely, the relative value of the part of the economy rooted in physical limits will be worth relatively nothing.
Which contradicts the earlier point part of the economy can perpetually grow when some parts do not, unless the parts which cannot perpetually grow simply become free.
Not only this but you must also take into account the source of the money that buys your digital goods.
There is a strong correlation between the environmental cost and economic growth. It might weaken but it will never be decoupled, as long as people do have 'material' needs.
If I sing beautiful songs on the street, that has a material value one could measure. It represents economic growth compared to a world where I do something unproductive, like arguing basic reasoning with people on HN. It does not, however, require more input materials.
I swear, one day I'll find out why the software crowd, of all people, is completely incapable of understanding the difference between "material" and "real".
Ahh but those machines are constantly becoming simultaneously more efficient and more powerful. And soon enough they'll all be ran on renewable energy.
OP said nothing about growing the population. His statement can be true even as world population growth is slowing.
Like many things, there may be no purely immaterial, but there is much (and increasing) practically immaterial.
> Ahh but those machines are constantly becoming simultaneously more efficient and more powerful.
There are limits to efficiency due to fundamental laws of physics. We're already hitting some, we might be far from others, but a) we may not hit all of them fast enough to met the demand of exponential growth, and b) after we hit them, we can't improve those machines/processes further.
we need to build the first solar power plant only using the output of a smaller solar plant, so electric digger, hydroponics for food, electric smelters etc. after that it's all downhill.
> Human beings like yourself require material inputs to live – food, shelter, energy, to name only a few. Just by being alive on a biosphere, you are impacting the environment in some way. T
They would be doing that if they were not giving massages.
> There is simply no such thing as "immaterial" economic production.
To quote a wise man, "The immaterial has become ... immaterial"
that is a shortsighted reading. OP's job could have shifted from e.g. "driving a heavy truck all day for my plate of food" to running a program on a computer which generates only a miniscule fraction of the emissions. As such , the economy overall has become "greener" for equal benefit.
There an upper bound created by the limits of possible human time spent. You can raise them with technology or population growth, but there again, you're bumping up against ecological constraints.
You can raise them with technology or population growth, but there again, you're bumping up against ecological constraints.
Population growth, yes, but technology? Why can't technology continue to improve in terms of efficiency and environmental impact as well as productivity?
There are physical limits to efficiency. In different technologies were are different distances away, but there are always limits that we cannot exceed. We can get creative about not needing to get close to the limit, but the limits are always there stopping us.
We might migrate to other planets. Also time and space are relative.
I doubt it. Maybe mars and venus, but even there getting self sustaining is going to be hard. There is no reason to suspect that we will ever be able to get anywhere else with less than a generation ship, and no reason to believe we can make one them them that will work long enough...
Edit: see https://news.ycombinator.com/item?id=21207011 which coincidentally happened to be in new articles when I checked...
Technology is the primary lever of pushing limits back.
Productivity growth is in that equation, which is also in admittedly short supply. Probably the most underrated essential factor of growth in a mature economy.
I don't doubt there is, but we really don't know when we'll hit the limits technology allows for. Present and future technological plateaus may just be temporary.
Even if this is would be true, is the idea that everyone shall work as and end in itself because of a dogmatic growth goal? At what point do we realise that it's based on artificial scarcity?
But doesn’t economic growth means an increase in consumption, however immaterial the product is? Meaning, there will still be a limit in what people can (not to mention want to) consume at the point we are saturated in Content™, so more people will just have to be made to increase economic growth.
Paying more for things is also considered growth.
Presumably higher quality content
More energy is required to create or obtain higher quality content. Some call this the “energy primacy” of the economy that is often not accounted for when talking about GDP growth—which I suspect is one of the reasons economics has been termed “the dismal science.”
Energy input per unit of GDP is an important metric that economists and environmentalists look at. Same for Co2 output per unit of GDP.
Inflation is removed from "real" (yes, that's the technical term) growth numbers.
If technological efficiency had any effect on lowering overall consumption, we would see that now. But we don't. Consumption in real terms is increasing at an exponential rate. This is called The Great Acceleration.
Turns out people use the efficiency of technology to just consume more. Your internet goods and services might increase consumption somewhere else. Some of it is even explicit. Google Ads is a digital service that explicitly is designed to increase consumption. In fact, all the great technology companies (Microsoft, Google, Apple) are designed around the idea that people will consume more. The tech industry, in aggregate, has been designed around getting people to consume more. Even Tesla, a green play, is designed around more consumption. Tesla could have been a company where you paid them, and they took your car and converted it to be an electric car by stripping the engine and adding batteries. This kind of play could have reduced real consumption. But that's not what Tesla is about.
on efficiency increasing net consumption, this is called Jevon’s Paradox:
Thanks! I knew there was a name for it but.couldn't remember.
We already did actually. LED lightbulbs caused household power useage to drop in spite of the proliferation of networked computing devices. Thats right adding in a whole new category of power consumers wasn't enough to make up for the drop.
It really only makes sense to understand the world economy as a whole. On this scale, consumption (e.g. steel production or oil consumption) continue to grow [1,2]. Americans are in the fortunate position of selling services (e.g. finance, advertising, information management) and consuming finished products from the rest of the world, but the American economy should not be considered a closed system.
Indeed, or to be a bit cute about it: "Does the 'America' graph include the 'China' part of America?"
Not that China is part of America. More like the two are squabbling lovers locked in an embrace so tight that it's literally "'til death do us part."
Doesn't matter. The amazing thing about trade is actually how much of a great tool it is in bringing countries and societies closer despite all other differences.
Said in other ways, China and the US may not like each other, but they will never go to war with each other as long as they trade with each other.
Your point is well taken, insofar as manufactured goods, but does not explain the decline in agricultural and construction inputs. In agriculture we're (currently) a net exporter and construction is non-traded.
There certainly may be industries where real dematerialization is taking place, and the author of the article would've been better off sticking with those. Instead the article makes sweeping, unsubstantiated claims across the entire economy that just aren't credible.
Decades of optimization. Fertilizers sold by the pound are purer now than before -- more refined. GMO makes crops immune to many pests and diseases. Cross breeding with drought tolerant crops reduces water requirements.
Technology like Hydroponics also reduces consumption while increasing output.
Computer aided design helps with construction.
It's all there.
This is part of why R. Buckminster Fuller thought there was more than enough to go around.
> This consumption takes into account not only domestic production of the resource but also imports and exports.
But, importantly, not the current account balance (https://www.bea.gov/news/blog/2019-03-27/us-current-account-...).
Yes, leaving out the consumption of materials in the form of goods manufactured elsewhere is such a giant, glaring hole in the logic that it strains credibility to believe it's mere oversight. It looks like deliberate misinformation.
You seem to have ignored the parts about agricultural and construction inputs.
Additionally, the manufacturing output of the US economy has continued to grow in the 'post-peak' period.
No, I read the whole thing. It talks about imports and exports of raw material, but excludes the import of those same materials in the form of goods manufactured elsewhere. For example, raw copper would be included, but copper coils in a refrigerator manufactured in Korea would not. That seems like an extremely arbitrary distinction, and one which would likely change the graphs presented significantly.
I was also thinking about this. We manufacture more in dollar amounts but I'm curious if that translates into quantity amounts. Higher tech manufacturing like chips instead of nuts and bolts, beams, industrial equipment, etc.
I have to agree with you. The article is fatally flawed unless it can address these issues you mention. I'm surprised the readers here didn't catch it but I suppose they were busy discussing how quantities are priced at the supermarket.
This reads to me mostly as the US importing more, so the increased material use doesn't show in statistics. The article also mentions increase in use of plastics.
One thing I'm curious about though - how come energy use stopped being correlated with economic growth? That's new.
Afaik energy use being correlated with economic growth depends on how much of the economy is based on energy-intensive industries, like manufacturing.
The US, as many other developed countries, has been shifting out of manufacturing economies to service economies for a while now.
Case in point: Nothing at Disney stipulates a correlation between their "economic output" and their energy consumption.
Meanwhile, a steel/aluminum plant in China will have a pretty direct correlation between economic output and energy input.
> Case in point: Nothing at Disney stipulates a correlation between their "economic output" and their energy consumption.
Not convinced. Whether movie creation or Disneyland, it all seems O(n) to energy use, except the constant factor is much smaller than for a steel plant, so we don't notice the correlation yet. Computers need electricity, man-hours ultimately have an energy cost, you need space and energy to entertain all the Disneyland visitors, etc.
I think I've found the answer to my question in other comments, though. The article focuses on US economy, but given the scale of imports, it doesn't really make sense to treat US economy in isolation. Just like I suspect the "dematerialization" is an artifact of not counting inputs to outsourced manufacturing of imported goods, I now suspect the decorrelation of energy use and economic growth is just an artifact of not counting the energy embodied in imported goods.
As I understand it, a service-based economy is more energy-intensive. A service based economy requires a pre-existing industrial base; services activity are actually managing actual stuff streams, and streams about these streams. Plus, you need heating, transportation, internet etc for all of your office workers, which requires energy.
The absence of obvious correlation doesn't remove the need. Just like there would be no advanced economy without a working agricultural infrastructure to provide food to everyone...
Doesn't that really depend on what the services are based?
Driving food around in a gig economy is just another logistics jobs, driving refined metals around between different refining processes is also just another logistics job, but one with more "energy-intensive cargo".
All that tech, the cars, the infrastructure, they need those base materials you can't just "service into existence" as you can do with IP and copyrights.
Sure, all that tech needs electricity to run, but the really big emission and energy footprint they create during their creation, not during their use.
Just a hypothesis but I would guess it's because services and productivity improvements are driving economic growth rather than products.
I bet reoccurring service fees are accounting for an increasing proportion of spending to the average American. The traditional electricity, water, phone, cable, and internet services have largely increased in costs while also expanding to include house cleaning and sub services like Netflix, Amazon Prime, Hulu, Spotify, Patreon, Adobe, Dropbox, Curiosity Stream, etc. And that's not even including other sub services that offer physical goods at inflated prices over retail (butcherbox, stitchfix, wanc, birchbox).
There's just so much shit to subscribe to anymore.
Edit: I forgot, digital-only video games and movie rentals too.
That doesn't explain the fertilizer usage very well, and from what I understand the story with ag is improvements in efficiency.
Agriculture is mostly down to glyphosate resistance, i.e. GMOs.
If you can spray a field with glyphosate, you don't need to till at the start of the season. Tilling has huge externalities, both the carbon emitted from the powerful plow used, and also the runoff from the disturbed soil. That runoff, which can cause all sorts of contamination, algal blooms, etc., is also leeching needed nutrients from the soil.
If you avoid tilling, you ultimately need to use less fertilizer.
Coupled with decreasing acreage for a given yield, that might be an ok trade off.
The article says that imports were accounted for.
The accounting seems to be done per category. Manufacturing is a wasteful process, so when you import finished goods instead of manufacturing them yourself and account on basis of mass, a lot of used mass is missing.
Now ordinarily, I'd assume it's a trivial thing that obviously must have been corrected for. But recently I read that apparently, US's disappearing manufacturing was hidden in statistics for a long time, because some people miscounted semiconductor industry as if it was manufacturing appliances. So I guess mistakes like that happen.
Only imports of raw material. Not finished goods. And don't forget all the resources embodied in the actual means of production! That's a lot of heavy machinery.
Wages have been mostly flat, so consumers have no extra money to engage in additional buying. Since the Great Recession of 2008, the top 1% of the income distribution have absorbed 125% of productivity gains. This is the reverse of what we saw in the 1940s and 1950s and 1960s when strong labor unions were able to win 110% of productivity for workers, so that the share of national income going to labor increased. Now the opposite is happening, with the share of national income going to labor decreasing.
> Wages have been mostly flat, so consumers have no extra money to engage in additional buying.
Check out  and scroll down to Table A-7 (it's an Excel file). It's the real earnings data (in 2018 dollars), by gender, from 1960 to 2018 (though it's kind of spotty before 1967). What sticks out to me:
* For men (looking at Total Workers), real earnings are currently around 10% higher than they were in the 70s (moving from low-$40K's to recently just past mid-$40K's, with some peaks and valleys along the way). Doesn't sound like much, but...
* For women, earnings have roughly doubled in that timespan
* The number of men in the workforce has increased by almost 50%
* The number of women in the workforce has increased by almost 100%
From a certain perspective, it's kind of amazing that real earnings haven't gone down significantly.
 https://www.census.gov/library/publications/2019/demo/p60-26... (Census report that came out last month)
Women didn't work as many hours back then. A lot of career options weren't possibilities then, either. Women's earning increases are largely attributable to cultural changes.
Well... just last night, I was planning a trip. There was a place I could see on Google Maps (satellite view) that looked interesting, but it wasn't clear that I could turn onto it (there might be a barrier or an elevation difference). But Google Street View made it clear that I could turn onto this little dirt road in the middle of nowhere. For free.
That isn't wage growth. And yet, I am better off for being able to do that - not better off in terms of dollars, but better off in terms of being able to more easily do the things that I want to do.
Would the computer or mobile phone used to see that satellite map be a new category of device if we're comparing to 30+ years ago? I remember when I first moved out of home that there were council rates, water, electricity and gas bills. Optionally, phone too. Now there's internet, 2x mobile phone plans (more if you have teenagers), Netflix, Stan, etc.
A lot of people are upgrading phones or laptops every few years too.
The tech is great, but it isn't always free.
I think most people would prefer to decide for themselves if that's worth the $40,000/yr that they would have had if wages kept up with productivity.
Did you read the article? Some of the resources hit peak use in the 1970s. With respect to crops, we're producing double the tonnage we did in 1980 with the same level of water and fertilizer, and greatly diminished acreage. There are also signs that new construction uses fewer materials to produce similar amounts of building.
There are similar indicators for Germany as well, and their wage picture is pretty different.
>This is the reverse of what we saw in the 1940s and 1950s and 1960s when strong labor unions were able to win 110% of productivity for workers, so that the share of national income going to labor increased. Now the opposite is happening, with the share of national income going to labor decreasing.
Yeah, but this is a good thing. The labor class is a very strong supporter of the political party that pushes policies which increase the income gap, and votes strongly against anyone who tries to change this or go back to the policies you're talking about. So they're getting exactly what they're voting for.
I don’t know what you mean. The working class reliably votes for the Democrats who continue to fight for strong labor unions.
It’s possible you were thinking of the white working class, but if that’s what you meant, then you should have said so.
They might be getting exactly what they're voting for. But they might not be voting for what they need or want.
It's not that hard to spin things in a way that people unknowingly vote for the opposite of what they actually want or need.
>It's not that hard to spin things in a way that people unknowingly vote for the opposite of what they actually want or need.
If people are intentionally voting for the opposite of what they actually need, why is this a problem? Who's the arbiter of what the voters "need" anyway? The voters are responsible for determining what they need, and voting for it; if they can't do that, then they're getting what they deserve, right?
Basically, this comes down to an argument of democracy vs. authoritarianism. Should the voters get what they want or vote for, even if it's seemingly not in their best interest? Or should some other party decide what the citizens need and force it on them?
The issue is less wages and more cots, especially of housing. http://eml.berkeley.edu//~moretti/growth.pdf
I wonder what this will look like in a renewable energy world where the cost of energy on the margin drops to the the small operating cost + the principal/interest on the capital expenditure.
We might actually see a reduction in GDP in that case, especially if coupled with ever increasing production efficiency for energy consuming processes.
In that case, we might have to re-evaluate how we define "success" to be less weighted for GDP, or include the reduction in fossil fuel externalities in the definition.
Could be be best race-to-the-bottom ever.
New Zealand is a model to follow . As you mention, of course GDP will plummet as renewables and technology act as enormous deflationary forces (good luck Central Banks trying to inflate against those forces). Software is eating the world, there is no marginal unit cost for delivering that benefit to the world. For example, consider what was previously spent across the world on TLS certs that now Let's Encrypt provides to the world for a few million dollars a year. Every opportunity for a Unicorn is an opportunity for a lean, well functioning non-profit to deliver similar consumer excess (or as a Human would say in behavioral econ, "happiness") very inexpensively (another example I love: Watsi.org ).
 https://www.vox.com/future-perfect/2019/6/8/18656710/new-zea... (Forget GDP — New Zealand is prioritizing gross national well-being)
 https://docs.google.com/spreadsheets/d/1tZq47h6jg7NX4ddhTS_H... (Watsi.org Transparency Log)
Margins for many of the oil, coal, and gas companies are already negative. The world subsidies those industries to the tune of $5 trillion a year. US subsidies it's fossil fuel industry to about $600 billion a year. In other words, energy is already cheap and GDP is still increasing.
Falling costs of similar goods and inputs are treated as deflation in economic statistics. "Nominal" GDP would fall in that case, but "real" GDP, which is the number everyone cares about, would still rise.
Considering how much of the economy is derivatives, options, and futures trading, this isn't exactly a surprise.
I'm no economist but the fact that we're using less of the most fundamental resources available despite a growing population doesn't seem like improving efficiency in aggregate, it just seems like decreasing activity masked by the inflated aggregated metrics about the 'economy'. A lot of money moves around nowadays and relatively little of it is actually put toward something "real", instead being diverted to quant firms' operational costs and their employees' bank accounts.
Define “real”. If I replaced your spreadsheet with a bunch of Python scripts, vastly improving your productivity, and you paid me for it, did something “real” get created in the process?
I think the subtext here is obvious to people on HN, but isn't this because so much value is generated using electrons on increasingly efficient computer systems?
That doesn't explain crop tonnage going up while fertilizer and water use are going down.
Did it occur to you that, like ordinary consumer products, industrial products also oversell their efficacy?
There was just a paper released about a widely used pesticide that did not appear to actually increase yields.
If the question is, how does crop tonnage go up without water and fertilizer use, maybe the answer really is a computer helped people plan better and be less wasteful.
Or all the least efficient farmers were bankrupted out of the market.
Corn yields have been going up a bit more than 1.5 bushels per acre since hybrid breeding started in the 1930's going from a steady ~25 bu/acre to >170/acre today.
Farmers haven't just been adding a bit more fertilizer and water every year, and it has been going on long before computers.
Many factors go into it: soil management with tilling practices and fertilizers, pest and weed management, improvements in irrigation and drainage, better harvesters which leave less on the ground, but very much most importantly, plant genetics.
>> Farmers haven't just been adding a bit more fertilizer and water every year,
Nice to believe and it is certainly what growers should be doing, but the evidence clearly indicates that they really aren't.
Nitrate levels in the Mississippi are directly correlated to nitrogen use in agriculture and in the upper Mississippi River and Missouri River, flow-normalized nitrate concentration and flux have increased steadily during 1980–2000 and is most measuring sites accelerated since 2000.
At the two most downstream sites on the Mississippi River, increasing trends in flow-normalized nitrate concentration are a relatively new development and at least partly reflect increases occurring in the Missouri River and the upper Mississippi River.
Many believe this increase in nitrate concentration is directly responsible for the Gulf of Mexico dead zone – an area of low to no oxygen that can kill fish and other marine life – which for 2019 NOAA scientists are forecasting to be approximately 7,829 square miles or roughly the size of the land mass of Massachusetts.
I don't see how Ausubel's conclusion on decreased fertilizer use squares with the measured reality on the ground (or the water) in this case.
You are assuming farms are the only or current main source of nitrates just because there is a correlation. Overtreated lawns and golf courses could have taken up the slack of farming usage for one. The other sectors need to be factored in for nitrate content.
Parent didn’t say it was the only source just said that rates correlated.
The fluctuation year to year may be due better growing seasons so farmers use more, but potentially so do golf courses and lawns. The usage of the others may definitely be drivers as well but agricultural use is correlated
"There was just a paper released about a widely used pesticide that did not appear to actually increase yields."
When my father was in a university geology department in an Agriculturally intensive midwestern state in the 80's, he worked on a few projects with farmers related to water use. One thing he looked into (unrelated to the main research project) was the cost/benefit of ferilizer use. The gist of it was that he came up a curve representing the marginal value added of fertilizer, which started high, and eventually went negative. Past a certain point, less fertilizer was absorbed into the soil and more went directly to runoff/there was more than the plants could use, something like that, and thereafter the added cost outweighed the further crop gains. Most of the farmers in the area were going beyond that point to some extent, and could increase their profit by decreasing fertilizer use to some extent. He said the farmers he talked to were skeptical, but one tried it out on one of their fields that year, found it to be an improvement, and a number of farmers in the area reduced their fertilizer to some extent using the curve as a guidance. The fertilizer sellers would probably just have said that more fertilizers would lead lead to more productivity, which was true, but not presented the cost/benefit.
I don't know too much about farming/crop science, but could see there having been improvements in things like this as well as GMO's & selective breeding. At one point Iowa State University was one of the leading statistics department in the US, which I believe was in large part due to the applicibility of statistics to farming.
"Or all the least efficient farmers were bankrupted out of the market."
One of the trends in the Midwest over the last few decades has been the transition from a larger number of smaller farms to a smaller number of very large farms. Perhaps this is greater efficiency/mechanization/scale.
If nothing else a large farm gains more from efficiency. $10/acre when you have 80 acres is $800. If you have 3,000 acres that is $30,000 - which means you can afford to pay for more efficiency.
Leibig's Law of the Minimum strikes again.
Do you have any sources for your claims? I saw the article about the pesticide on HN or reddit but not anything else you claim.
I can give some credence to the claim. I work for TeeJet a subset of Spray Systems and we design and manufacture application technology for the AG industry:
"At TeeJet Technologies our single focus is on application technology. Our company and our products have been part of agricultural applications since the first crop protection products came onto the market in the 1940's. Our control systems date back to some of the earliest in-field uses of electronics in agriculture. This experience in the fields of spraying, fertilizing, and seeding means nobody is better suited to provide quality products and technical solutions for your business."
Glyphosate, with GMO crops or without, means you don't need to till your land. It's enabled a huge fraction of productive acreage to become no-till or low-till, which preserves soil nutrients, aids soil water absorption, reduces agricultural runoff, improves cover-cropping, and more.
There are a variety of farming practices that contribute to the efficiency of agriculture, but no-till is absolutely central. The late 90s through early oughts saw big increases in no-till acreage, up to ~20% of all land by 2002, precisely when fertilizer inputs started to decline. It sits between 40-50% now.
Much more precise usage of water/fertilizer to optimize yield/input can be enabled by computation and data.
Precision Agriculture is the term for anyone looking to learn more. Even small farms now track all inputs/outputs on every acre they farm.
The Land O Lakes CEO was showing this off on 60 minutes just this past week.
Check out 5:22 in the video here:
A hypothetical example is drones going through a field and manually picking out weeds, increasing yield with the same amount of resources. Similarly you can get fine grained ‘crop analytics’ through drones scanning the field and acting in response.
And on what scale is this actually happening?
I don't have any figures citations since my knowledge comes from when I used to hang out on Precision Agriculture forums, but it's common and getting more so. As drones get less expensive, it's easy to sit in your den and fly over the fields looking for the areas where you should go out and spray some more, or drive over in your UTV and take a closer look at that "weird spot" on the "back 80."
Farmers are very aware of the benefits of technology (why else would you spend half a million $ on a combine?) and will take it up if they see a benefit.
I am sure they are. But a leap from combines to decentralized sensing using drones is a big one, and I'd want to see some numbers to verify this.
Re-reading the post, it seems that he and I might be talking about different things. I'm referring to farmers using remote controlled drones with cameras to check the state of their crops/fields without having to drive over hundreds of acres. That's an actual thing and is quite common.
OP seems to be talking about some kind of automated drone weeding (or just phrased what he meant poorly).
Very large scale, just not in the exact form GP is describing; instead, farmers drop stationary internet-connected sensors all over their fields, their sampling equipment GPS-tags results from every core sample, and tractors have computer-controlled equipment to feed location and quantity information to chemical dispensers.
See e.g. https://home.agrian.com/what-we-do/ for a company that manages this process.
I am not at all denying the benefits of technology, or that companies are working in it, but I am skeptical of how widespread it is right now. Therefore, I would want to see some numbers to verify such a claim.
I know that there is a profitable company whose people I have talked with, whose business is built on managing the data involved.
You should go google and research the numbers yourself.
Thank you for the advice!
Is this partly due to things like drip irrigation?
What about an increase in organic farming? Certified organic crops sell for higher prices, and all the big shops I see in California sell a lot of that. I'm under the impression that organic farms don't use petroleum derived fertilizers.
Technological advances in agriculture would presumably explain it, many of which are probably computer driven (precision agriculture, data-driven agriculture being two examples).
CO2 has helped crop yields.
No, it's because these things have been replaced by plastics.
At least partially I'm sure that's the case, however it looks like we're approaching the apex of that trend as well:
TFA: >> The growth in plastic consumption has slowed down greatly, to less than 2 percent per year between 2009 and 2015. This is almost 14 percent slower than GDP growth over the same period. So while America is not yet post-peak in its use of plastic, it's quickly closing in on this milestone.
It will be interesting to see what our other material trends do once we do hit peak plastic, if we shift to using more paper and aluminum as people push back against plastics for their various drawbacks.
That's irrelevant because plastics are not produced domestically in the US. But the international production explains the decreased consumption of those other raw materials.
This article is misleading horse shit.
I didn’t see it addressed in the article so I’ll slip on my tinfoil hat for a moment...
Could this be related to growing income and wealth inequality? Poor people buy less stuff, and presumably rich people get rich by not buying more stuff commensurate with their incomes. Even the falling fertilizer consumption might be explained if poorer people are shifting to more processed junk food.
The article notes 1970 as the critical turning point, which is the same year Piketty identifies in his book Capital as the inequality turning point in the U.S. and Europe
This reminds me of the phrase "if you only have a hammer, every problem is a nail".
> Poor people buy less stuff, and presumably rich people get rich by not buying more stuff commensurate with their incomes
One implication of the above statement would be that everyone is now buying less and yet somehow the economy is growing? Those two ideas aren't strictly necessarily opposed to one another but it certainly doesn't seem like a good place to start. The economy could only be growing through investment if this were the case.
> Even the falling fertilizer consumption might be explained if poorer people are shifting to more processed junk food.
Is there any junk food that isn't composed of organic matter primarily? Most "junk" food in the US that I can think of is corn based which would of course still require fertilizer...
This is actually what I was thinking, but I live in opioid infested flyover country, so my mind always goes there.
Not many people out here buying new cars, or washers and dryers, or even homes right now. And then in the other world I live in, tech, people not only do all that, but they also fly to Greek Islands for vacations. It's really kind of bi-polar right now. At least around here it is.
The raw ingredients required for junk food require massive amounts of fertilizer (soy, corn, wheat, sugarcane).
I don’t know enough about economics, nearly enough, in fact I’ve decided after listening to an economics podcast for the past month (still working through the backlog) that I’m essentially a know-nothing today.
That said, I have some questions if there’s an economics know-something around here, because there might be an alternative explanation than just a rise in inequality. For one thing, to maintain the standard of equality/inequality that exists today, I would think even the richest would need something to dump their money into. Right now that seems to be the United States economy, mostly, and a few fairly solid foreign markets, Japan, the EU, Hong Kong, Britain, and for the less risk averse, there’s also the PRC and various developing economies. Mostly the US is where you get your safest ROI.
So a massive growth in investment, would seem to also suggest a massive growth in the financial services market. Not to mention the massive amounts of money sloshing around throughout the Bay Area. At the end of the day, you still need bankers handling all the transactions.
And that’s just it, the United States today, near as I can tell and certainly this is what I was taught and the dogma of today, is a services-based economy. Banking, health care, government, etc, not to mention the usual suspects among tech: Google, Facebook, Amazon, Apple, Uber, Lyft, Doordash, Microsoft, Netflix, etc.
Now between them, there’s a lot of products getting designed, and built, and shipped, and sold. Computers, phones, and I’m sure even the cars drivers use for fares and deliveries are consuming a fair amount more resources than your average car. In providing their services, they are charging a premium, and in return you get convenience. If you use AWS or Azure, you’re still using something tangible and real, you just don’t own the infrastructure. But the people that do are benefitting from economies of scale large enough that there are ultimately fewer servers and data center than there otherwise would be if all of their customers bought their own. So in a real sense, it really does seem like more value is being created with less resources that way.
So now that whoever is reading this knows where I’m coming from, here is my question to economics know-somethings (fair warning, my jargon might even be off or used incorrectly): does our economic shift away from agriculture and manufacturing towards a service and information-centric economy have a possible causal effect on our ability to grow the economy with seemingly fewer resources? If so, is there one part of the services sector which seemingly has an outsized influence in decreasing our resource use while growing the economy, be it financial or tech or something else?
Seriously, thanks in advance.
There is a factor. The energy it takes to melt metal is hard to get around. The US manufactures more than we are given credit for, and there have been improvements in efficiency, but it is still energy intensive and hard to get around it. Thus services are a factor in that they need less energy.
Things last longer. (when there isn't planned obsolesce) We have learned to make things higher quality, so even when we make something the energy cost to replace it latter is deferred a little.
The miles people drive isn't increasing. Something as somehow got people to drive more and more each year. Services is probably a factor in that: why drive to X when you can stay home... (walking - or even driving someplace closer count as staying home)
It is really hard to know which factors are important though.
There is nothing "tinfoil" hat about what you said. This is a known outcome of growing inequality.
In the 1970es the usd is also delinked from the price of gold. This allows for rampant inflation which should be filtered out from the growth figures but maybe it is not quite the case ...
Does this relate to the buyback-debt cycle of companies? 
Physics > Economics
The Do The Math blog by Caltech-trained UCSD astrophysicist Tom Murphy is the best resource in this area.
In particular the posts
- Galactic Scale Energy https://dothemath.ucsd.edu/2011/07/galactic-scale-energy
- Can Economic Growth Last? https://dothemath.ucsd.edu/2011/07/can-economic-growth-last
- The dinner conversation with an economist on this topic https://dothemath.ucsd.edu/2012/04/economist-meets-physicist
I read those and conclude "Physics is not a particularly relevant constraint on economic growth."
His energy analysis concluded that at 2.3% growth rate and current technology, we would need to use the entire energy supply falling upon the earth's surface within 275 years. Improving technology might be able to stretch that to 400 years. Within 1400 years, we would need to use the entire energy of our solar system.
But we have a number of more pressing demographic constraints. As countries develop, fertility falls; fertility rates are currently below replacement in the entire developed world  with all regions other than Africa falling below replacement rate by 2050. Within 80 years, population is likely to start falling, with some studies predicting this within 30 years. Worse, there's a worldwide demographic bulge of 18-30 year old males that's hitting just about now; such demographics have been associated with a higher likelihood of war in the past.
There's plenty of other problems that these bring: if you don't get killed in war and manage to find a mate, you're not likely to see your social security or 401(k) worth all that much, nor will you find health care unless your rich or lucky or both. But they'll happen way before we reach physical limits on growth. Our threat model should be stupid politicians doing stupid things at the behest of frustrated populations, not the laws of physics.
The demographics issue makes this whole situation such a massive paradox.
On one hand, we want all those extra humans to generate "economic growth" to keep our perpetual growth train going.
On the other hand, the environmental consequences of that seem already unbearable for our biome right now.
It's like we want to have our cake and eat it too, it just won't work. If we want to "save the planet" then we need to let go of this insane idea of perpetual economic growth we supposedly only can solve by throwing more human bodies at it.
Many human cultures have lived without growth.
Economists and others who think growth is necessary to distribute goods don't know what they're talking about or have ulterior motives.
A parallel to this concept is that of "decontenting" a product. Nissan did this in the 1980s and 1990s to the Maxima to keep prices in line with the Camry and Accord.
Specific references on the Maxima and Nissan's practices?
Thanks, though I'll note that's a 23 year old article.
Related to this, he's made a whole slew of longbet predictions on us consumimg less of these resources.
Is this simply because manufacturing is offshore?
That would only explain manufacturing inputs.
Also analyzed are building materials and agricultural inputs. Buildings can't be off-shored, and if anything, we're a net exporter of agricultural products. So the analysis holds.
Exactly. The primary inputs analyzed here are manufacturing inputs and if manufacturing has been outsourced so should the consumption of the inputs.
That seems like the most likely explanation, especially since this trend started right when trade opened with China.
It's confusing to me that this isn't proffered at all in the article or most of the comments here. Without understanding this factor, how can "dematerialization" be taken seriously?
> Without understanding this factor, how can "dematerialization" be taken seriously?
I don't think it can. My thought went to suspecting we simply don't "directly" consume raw materials only because this story doesn't pass the common sense 'sniff' test. If I look around me at my lifestyle or my friends/family/coworker's lifestyles, consumerism seems to have increased and not decreased. Think of the rise of ubiquitous handheld electronic devices, fast fashion (Forever 21, H&M, and so on), online shopping, and so on.
Moving an economy from real things to services and ideas begs many questions, not the least of which is "what does price even mean" because the cost/price nexus had some meaning with real goods, but has almost no meaning with services and ideas.
A perfect cure for age related death is worth so much, it probably has undefined value. A TV show as a bitstream is worth nothing (bits ephemerally have no value), can be infinitely copied, and yet IPR law defines its value as a function of the lock on the disney vault.
Economic treatment of costs varies, but there are two principle variants.
The mainstream view is that "all costs are opportunity costs", which is to say, the best alternative use of some input. This is probably best further expanded to the notion that an opportunity cost is based on the consumer value received from the use stream defined by the alternative use, which is a bit abstract, but generally tractable.
An alternative, with antecedants to Adam Smith, is that costs are based on the factor inputs to production. The mainstream views these as labour and capital (or increasingly, simply capital), but a more comprehensive view would be for a number of inputs: material, energy, knowledge, capital (itself reserved production from earlier periods), labour, organisational services, and sinks. An early version of this appears in Leo Tolsty's What is to be Done? (1886).
Service and information are distinct from material production (goods, construction, capital) in several regards, but are not fully immune to physical considerations. In particular:
- Services require labour, capital, and energy inputs.
- Services are, in the words of one of the early economists (Smith or Mill as I recall) "immediately extinguished". That is, in the most fundamental sense, services are non-capitalist in that one cannot reserve production of services as capital. (The results of services may be.)
- Information has numerous characteristics which make its pricing virtually completely incompatible with market-based systems as information is a pure public good, in the econonomic sense: nonrivalrous and nonexcludable.
The upshot is that service-and-information economies neither spare us from physical resources, nor are amenable to the management and explanatory concepts that have guided most of the past 200 or so years of economic development.
Also, nit, the question is raised but not begged:
Because there is no growth! It's just the multiplujillion dollars The Fed plucked from thin air that make it seem so.
Anyone with half a brain knows that something is fucky.
I had a friend who was gloomy about resource extraction one time. I comforted him by saying there are few limits on the number of masseuses and story tellers we need.
As we get better and better at producing the necessities, we'll desire more luxuries, some of which are experiences.
Glad to see it confirmed in the numbers.
I would like to know how much of American dematerialization is just exporting materialization to China. They make our stuff, we import it. Does that count as materials consumed by Americans? Note that they mention the great reversal starting in 1970. Nixon went to China in 1972.
There's a strong reason to believe it's much of it.
The true raw material footprint of nations
The material footprint of nations http://www.pnas.org/content/early/2013/08/28/1220362110
As of 2010, total global per capita energy consumption was rising:
Most of the above, plus further discussion:
Economic decoupling? The recent relationship between energy and growth
Not only that, what about the end of infrastructure? Timber, steel, copper, asphalt, cement -- these are signs of a country investing in its infrastructure. Other than copper, if we saw a trillion dollar infrastructure package, our de-materialization would vanish in a heartbeat, and our carbon emissions would shoot WAY up.
With information age I'd assume those things with more predictive logistics and transparency would get more efficient. We should add in data transported too in these metrics and I'd guess the correlation would become more obvious.
I'm no gold bug, but, looking at the graphs in the article, it's interesting how GDP decouples from resource use around the same time that the US went off of the gold standard.
Americans are flat out doing less. We move stuff around, tell people what to do in other countries, and write software and that’s kind of it.
The a16z podcast recently had an interesting episode featuring the author of this article. It discussed the divergence of the GDP + energy usage curves as well as some of the other stuff in his book.
Can we overlay the use of plastics? Which is curiously absent from this study?
Andrew McAfee did an interview last week w/ Sam Harris  that was a fun listen if you are interested in a conversational understanding before reading his book.
Isn't that a good thing? Use less real resources folks.
“but”? how about “and”… these are all positives
It doesn't fit the narrative.
More value with less inputs? Sign me up.
Capitalism at work, saving the environment.
Increasing profits necessitates reducing one's demand for supply. Using less steel, paper, fertilizer, and energy to achieve same/better results while tautologically using less resources is indeed good all around (mostly).
While I don't disagree that capitalism is at work. It is almost a given that the reduction in steel is due to auto manufactures and many other industries have moved to aluminum or composite materials. Neither one of them offers a great environmental or energy savings over steel.
Paper is most likely digitization which again just transfers the energy use into computing every time the document is viewed and is almost certainly a net negative in relation to energy consumption.
Fertilizer I don't know but a half ass guess would be GMO's. As they are able to target traits that allow them to use less fertilizer and pesticides to produce the same amount of crop yield.
"Good news! We’re getting more while using less."
Or maybe we just haven't accounted for inflation and the rampant advent of landlords and landlord-like start ups which consumes greater and greater slices of the consumer's money.
Yes. I think the financialization of the economy means you can't compare numbers over time.
Great title - - totally boring read.
Growth for who? Interestingly the words poverty, austerity, unemployment, education and health cuts are all missing from this "economics" article. There has been a single trend since Capitalism began centuries ago - the rich have been getting richer and the poor poorer. Yield curve's looking good today dear, we're being evicted, but damn it looks good.
This seems to be the flip side of designing things to be no more durable than necessary. With the highly regulated exception of cars, the profit motive is driving companies to use the least amount of material, whether it’s a washing machine made of stamped metal or a tissue-thin plastic bag.
On the other hand, well-meaning socialist interventions are driving additional environmental impacts, as people buy “reusable” bags or higher-CO₂-impact paper bags instead of changing their behavior the proper way.
This feels right to me. At the peak material usage highlighted in the graphs, around 2000, consumer products seemed to built considerably more ruggedly than they are today - possibly over-built, really, in some cases. If you shave off 1 or 2% of the material going into a product year over year, that really amounts to something after two decades.