We are now living in a world where due to the Covid pandemic the economy is down, the economic recovery does not look promising anytime in the near future and technology developments are slow to pick up. We are used to the terms of Artificial Intelligence, Robotics, Internet of Things, Augmented and virtual reality etc. but these technological changes are not picking up the way it should be.
US, one of the most developed countries of the world is in fact showing a change. The economy is slowing and the strangle hold of Covid is slightly getting released these days, resulting in people being able to move freely and businesses being able to reopen and start their activities afresh with new vigour and strength.
Three factors are prominent here -
Factor 1 - J type of economic growth
Factor 2 - technological progress
Factor 3 - consolidation impact of Covid
When we look at J type change in the economy, it indicates to us that initially the pace of change is very slow, dragging for years together, this years growth depending on the previous year's growth and then suddenly we come across change, at blistering pace, at exponential pace.
If we look at the J curve the growth is unrestricted while in the S type curve, the growth is restricted, plateauing after some time.
The predictions are that the US economy is heading for a J growth curve now. If the global economy also follows the US economy, of course after lot of the present political upheavals happening in different parts of the world are tackled well, we can look forward to a period of high growth and a period of plenty across the world.
The other reasons supporting a positive growth of the US economy is a surge in technology growths. The benefits of AI is slowly getting spread across various sectors of the society and industry. This is sure to bring great rates of growth and productivity improvement.
Combined with this is a third factor of the restructuring of the global economy that is happening now. The pandemic and its early withdrawal can lead to lasting benefits. When the world was just getting to realise the benefits of remote work or Work from Home in a time of ten years, the pandemic has compressed this time period and allowed all of us to experience the benefit of working from home early enough. ,
Though Eric Brianjolfsson and Georgios in their Technology Review article of June '21, The Coming Productivity Boom, (click here), mentions that this is symbolic of US, the author of this article in India also after doing a preliminary industry research, has come to the same conclusion in India too.
The benefits of the J type of growth in economy, combined with consolidation of technology benefits and early life style changes effected by Covid, is pressing the whole world into a period of growth and development in the next ten years. It is more than any wishful thinking ...
George.
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