The ideas economy

Paul Romer, a 2018 Nobel laureate in Economics and a colleague at Boston College, has built a career thinking about how ideas shape economies. (See his 1990 article, cited a mere 43 thousand times!) Here's his summary of why he won the prize:

The human condition emerges from a never-ending contest between the dismal Malthusian economics of objects and the unrealized possibilities of the economics of ideas. For centuries, economists took sides and followed Thomas Malthus. A paper I published finally turned it into a fair fight. Economists no longer have to assume that Malthus wins before exploring the question posed in the title I chose for my Nobel lecture: “On the possibility of progress.” (source)

Progress comes from ideas, and ideas come from people. In his vision, people are not of the sort that Thomas Hobbes invokes in describing the state of nature as a "war of all against all." Rather, people start to sort bad ideas and good ideas, and act on good ideas. One case study involves Burning Man, the pop-up city of 70,000 that happens each summer, which reflects his interest in "charter cities"--the subject of a 2009 TED talk.

In brief: Romer believes in people. He is also very concerned about bad digital actors (including those who have impersonated him on X), and will be begin his work at Boston College's new Center for the Economics of Ideas with a focus on digital signatures--these, he writes, will ensure honesty, a foundation for the exchange of ideas.

I'm intrigued by his thesis and his work, which offers an economic argument for the historical one that Arnold Toynbee (of "creative minority" fame) offered. Bernard Lonergan, whose work influences the book about social progress I'm working on, similarly stresses the accumulations of insights which help reverse short- and long-term "cycles of decline." Ideas matter, which means that people matter, which in turn means that it is critical to be clear about the ingredients of good ideas. Lonergan's answer, which I'll unfold later, involves paying close attention to the ways that human beings come to understanding of the real world.