The Coming Prosperity: How Entrepreneurs Are Transforming the Global Economy

When it comes to technologies that have made it all the way to the village level on a truly global scale, the previous success was the radio. And before that? Fire.

Seriously. In part that’s because the economics of the twentieth century was overwhelmingly about how best to share existing “pies” of human well-being, rather than how

Potential answers to that question are, of course, limitless. But, at the start of the twenty-first century, a few will stand out: “I know how to connect”; “I know how to create”; “I know how to contribute”; and “I know how to collaborate.”

The advent of capitalism-at-scale induced major social and economic dislocations, but at the same time drove a tremendous increase in the availability of low-cost consumer products, substantially enhancing workers’ quality of life.

Economist Martin Weitzman has put it this way: “Can we imagine a world in which we’d run out of new ideas?” Almost inconceivable. The reason is that most new ideas are generated as new combinations of old ideas, and the number of new combinations is almost limitless:

the real power of large open networks, like those enabled by mobile communications, is in the third dimension of network participation: recombination.

As Joseph Schumpeter observed a century ago in The Theory of Economic Development, The necessity of making decisions occurs in any work. No cobbler’s apprentice can repair a shoe without making some resolutions and without deciding independently some question, however small.

That was understandable because, for the bulk of the twentieth century, basic research and big business were the primary vehicles of economic growth and prosperity.

Only when enhanced by the power of recombination does the increased efficiency achievable by specialization—heralded by Adam Smith in The Wealth of Nations—yield TiVos, Mini Coopers, camera phones, and all the other complex outputs of twenty-first-century global supply chains.