Sunday, November 30, 2008

Paul Romer, the young economist whose work on New Growth Theory had stressed the importance of technology in economic growth and, by implication, conferred a magnificent important on the new new thing, hinted at another, deeper reason technological change was so unsettling. In a digression from his otherwise rigorous analysis, in a 1994 issue of the Journal of Development Economics, Romer wrote, "Once we admit that there is room for newness - that there are vastly more conceivable possibilities than realized outcomes - we must confront the fact that there is no special logic behind the world we inhibit, no particular justification for why things are the way they are. Any number of arbitrarily small perturbations along the way could have made the world as we know it turn out very differently....We are forced to admit that the world as we know it is the result of a long string of chance outcomes.

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