Is the "great stagnation" in innovation and economic growth really over? What new technologies on the horizon are most likely to reviving broader dynamism? Does the global spread of low fertility mean that our escape from stagnation is only temporary?
On this initial episode of the Permanent Problem podcast, economist and polymath Tyler Cowen joins host Brink Lindsey for a wide-ranging discussion that traces Cowen's intellectual development, assesses the prospects for a revival of capitalist dynamism and the obstacles that might short-circuit it, and delves into the growing gap between material prosperity and human flourishing.
Below is a lightly edited transcript of our conversation.
Brink Lindsey: Hello, everyone. Welcome to The Permanent Problem Podcast. I'm your host, Brink Lindsey, from the Niskanen Center. A little over a year ago, I started a Substack called “The Permanent Problem,” where I've now written dozens of essays about capitalism's 21st century malaise and how to get out of it. In year two of the site now, I've decided to write a bit less and talk a bit more. So I'm delighted to introduce as my very first podcast guest the one and only Tyler Cowen, economist at George Mason University, blogger extraordinaire at Marginal Revolution, host of Conversations With Tyler, director of the Mercatus Center and Emergent Ventures, and author of many excellent books, including most recently, GOAT: Who is the Greatest Economist of All Time and Why Does it Matter? More about the new book later. But first, welcome, Tyler Cowen. Great to have you on the show.
Tyler Cowen: Hello, Brink. Good to chat with you.
Lindsey: Okay, let's begin at the beginning. Fill people in a little bit about who Tyler Cowen is. When were you born and where did you grow up?
Cowen: I was born in 1962 in Northern New Jersey. I started growing up in a blue collar county, but over time my father did better and I ended up in an upper middle class county, Bergen County. I went to New York City a lot. I was very early a chess player, and then I turned to economics and philosophy and I never stopped. That's my life in a nutshell.
Lindsey: What about Tyler Cowen is inexplicable except for the fact that you were born in the early '60s and grew up in Northern Jersey?
Cowen: Well, I think for most people, what's hard to grasp is that I read very quickly and a lot of people don't believe that I do or that I can. Once I started running my own podcast, which is not edited, a lot more people started believing that I actually read all those books. But that would be the thing people would usually cite, but I don't find that inexplicable. I just do it and I've done it my whole life. So it's weird to me that other people read slowly.
Lindsey: Yeah. So you don't feel like you read fast? You just feel like everybody else is going at a snail’s pace?
Cowen: I can't even imagine what they do in a way, but I feel I'm a fairly slow reader, actually.
Lindsey: You were bookish from the get-go. Who were your favorite childhood authors?
Cowen: Well, it depends which childhood.
Lindsey: Before 10.
Cowen: Before I was into economics, of course there were chess books like Irving Chernev and Bobby Fischer's My 60 Memorable Games. But a lot of science fiction, Arthur Clarke, Childhood's End, Isaac Asimov, Foundation, Robert Heinlein, the usual sorts of things one would read then. But then I read this book called The Incredible Bread Machine, early market-oriented economics book, Henry Hazlitt, Ayn Rand on Capitalism, Hayek, Milton Friedman, Adam Smith, et cetera. And that just got me going.
Lindsey: By the way, we're both born in 1962 and we've both spent most of our careers in libertarian land.
Cowen: Where were you born? I don't even know this.
Lindsey: I was born in Tallahassee, Florida.
Cowen: Oh, Tallahassee. And in which way are you still a regional thinker influenced by Tallahassee?
Lindsey: Oh, I think of myself, now I'm an American expat living in Thailand, but before that, I thought of myself as a Southern expat living in the North. So there's no doubt that growing up in the Deep South is imprinted itself in a whole bunch of different ways. So I would-
Cowen: But how would you tie it into your-
Lindsey: I would be a really different person if I hadn't grown up in that context.
Cowen: But if you had to tie it into your actual views or actual practices, what would you cite?
Lindsey: In that way, I'm probably more reactionary. I grew up in the South feeling like I was in it but not of it. And I was bookish and very displeased with, disappointed in the anti-intellectual, good old boy atmosphere of the south that I grew up in. So I grew up with an anti-South chip on my shoulder that I only later relaxed and came to appreciate my upbringing more after I left.
Cowen: But that made you more of a liberaltarian and less of a right-wing libertarian. Is that the way to think about it?
Lindsey: It could be, but I started off pretty right-wing. But yeah, I had impulses to push me away from early on.
Cowen: Yeah.
Lindsey: So what did your parents do?
Cowen: My father ran a Chamber of Commerce in northern New Jersey. My mother had different jobs but not a career. Part of the time, she worked for my father. He owned a magazine called Commerce and she did a lot of the background work for it.
Lindsey: And how did they encourage your intellectual development?
Cowen: Well, when I was quite young-
Lindsey: Did they recognize early on that you were different and that they had a job to do to push you, or no?
Cowen: Well, my father thought I was weird, so he thought I was different, but it would've been easier for him if I had, say, been a football player in the way that he was captain of his high school football team. He accepted what I became but I was not obviously doing things he had done. My mother was very open-minded. But when I was quite young, I'm not even sure how young, she took me repeatedly to the public library. At first, it was a Carnegie library in the town of Kearney, New Jersey, but later to Bergen County libraries. And without those library trips, I would've been very different. And then my father's mother, my grandmother, lived with us for a while and she taught my sister how to read. And I was about two and I learned by looking over her shoulder. And so my grandmother had to big influence on me. And my grandmother loved to read. She loved Shakespeare, Victor Hugo, John O'Hara, and also liked Ayn Rand even though she was not a partisan of any one of those things. So my grandmother too was a real influence.
Lindsey: Okay, good. And you have siblings?
Cowen: Yes, a sister, and later, half-brother. My half-brother lives in Brooklyn, a sister in Northern New Jersey. She's in human resources. He is a chef.
Lindsey: Good. Did you collect things as a kid?
Cowen: Baseball cards early on. I loved sports. There were many fewer things to collect back then, right?
Lindsey: Well-
Cowen: You couldn't collect digitally. I didn't actually have a lot of money.
Lindsey: Yeah. But coins, stamps, rocks. I don't know if kids do that anymore. I feel like they collect digital stuff now but not analog stuff.
Cowen: Yeah. I did stamps a bit, rocks a little. I think I would've collected more if I had found something good to collect, let's put it that way. I was a frustrated collector.
Lindsey: You're now known for your incredible diversity of intellectual interests. Was that from the start? Did your curiosity just naturally pull you in a million different directions, or was there some point where you recognized, "Hey, my specialty is breadth and I need to lean into that"?
Cowen: Well, I think when I was quite young, I was much more conservative in the small-c sense of that word. I didn't have an interest in traveling. I was more reserved. If you're a chess player when you're a kid, that's extremely narrow. And that was the main thing I did with a bit of science fiction. So the breadth, I think, came gradually and most of all in my very late teens with classical music, beginning to travel. So I don't think it was in me at the beginning in any obvious way.
Lindsey: But it came out in adolescence?
Cowen: Yes. But someone looking at me at age seven would not have predicted breadth later on.
Lindsey: So your Ethnic Dining Guide, that was before Marginal Revolution, right?
Cowen: Yes. I started that when I was teaching at UC Irvine. That would've been 1988.
Lindsey: Oh, so that's old.
Cowen: And it was just mimeographed notes at that time on Orange County.
Lindsey: So even before you started blogging, people had this news, "Hey, here’s this weird thing about Tyler Cowen. He's got this fantastic Ethnic Dining Guide." So that was a bit of public eclecticism early on, but once you started blogging-
Cowen: That's right. And you can think of it as a form of collecting.
Lindsey: Yes, yes.
Cowen: That made blogging easy. And once I moved to Northern Virginia, which I think was 1989 or 1990, I started putting the dining guide online and there was no such thing as a blog then. It was just like sheets online.
Lindsey: I remember it.
Cowen: I kept on revising it, and in a sense, it became blog-like. So when blogs came along, it didn't feel very strange to me at all.
Lindsey: That was your warm-up act. That's interesting.
Cowen: But there was no blogging software. You just put a Word file into something and it was totally clumsy.
Lindsey: So did blogging encourage you to double down further on eclecticism or were you just doing what came naturally at that point?
Cowen: Well, it came naturally, but A leads to B leads to C, so it definitely encouraged me. So if I would travel somewhere, well, I'd write a post about it. And I think that made me notice things more. And then I noticed more things. I got interested in more things, and it just keeps on going. So there are increasing returns to curiosity, or there should be at least.
Lindsey: So okay, you've talked about chess a couple of times. You excelled at it. You were state champion as a teenager in New Jersey. When did you start?
Cowen: 1972. The Fischer-Spassky match got me interested. I was in the hospital. I had my appendix out. I was fine but needed something to do. I had learned the rules of chess, but then I started playing. I got home, Fischer-Spassky was on TV. I watched that religiously. That just opened up the whole world to me. And those shows were great. Shelby, Lyman, Eugene Meyer, who is actually in our world today at the Federalist Society, blew my mind all of that. Just to see a TV show with smart people sitting around talking about smart things, it hadn't really existed. I also saw Firing Line a bunch of times a little older, and I thought that was great. And it wasn't even that I agreed with Buckley or didn't agree with Buckley, just the notion of people conversing about smart things and that it could be on TV. That was phenomenal.
Lindsey: Yeah. And Firing Line was especially highbrow. But Dick Cavett was a pretty highbrow talk show, and-
Cowen: That bored me.
Lindsey: Johnny Carson had highbrow guests. The talk show game was pitched at a higher level in our childhood.
Cowen: People recommended Cavett to me a few times, and I tried it but it was boring. I wanted more. I wanted faster. I wanted deeper. He was better than watching CBS on Saturday night or something. But even Buckley, I wanted more but he was approaching something. And when I started my podcast, as you have yours, Buckley was a big influence on me.
Lindsey: Sure. When did your chess involvement peak?
Cowen: I was champion of New Jersey, not for kids, for all age groups at age 15. And by 16, I had quit.
Lindsey: Go through the thought process there.
Cowen: Well, it seemed like a good time to quit. Back then, the lives of chess players were terrible. I mean, really terrible. Very little pay. Maybe the world champion could earn good money. You had to compete against the Soviet Union. No health insurance, no support network. It's better today for, say, the top 20 players and a bunch of streamers. But then it was just horrible. I thought, "No way do I want this." Chess players were lonely. They seemed miserable. I didn't enjoy the game that much. I also looked deep into my soul and I realized I didn't hate losing as much as the very best players hated losing or the very best athletes do. And I thought that was a sign I should do something else.
Lindsey: Well, that's a big deal, to have invested so much in something and to reap such rewards from your investment, and then bail for something new. That takes some pretty serious self-knowledge at 16 or 17.
Cowen: Yeah. But I also saw there were people who were better than I was. And maybe at the time, I was competing even with them because I had better work habits. But I realized over time, I just wouldn't be able to beat the people who were better and smarter at chess than I was. So what was I doing there? And economics was way more interesting.
Lindsey: Did you have any exposure to religion as a child through your parents?
Cowen: Well, a hostile exposure. My father was both an atheist and very strongly anti-clerical, which I've never been. I don't believe in a deity but I'm at the margin pro-religion. My mother was agnostic but not religious, and she had rebelled against her strict Catholic upbringing. And my grandmother was an atheist, which was very unusual back then. Not just not religious, but an active outspoken atheist. So I really didn't grow up with any religious impulse at all. And on average, I'm more pro-religion than my parents ever were, even though again, I don't believe, I don't practice, I don't anything. They had Irish Catholic backgrounds, and I think that was pretty oppressive in that time.
Lindsey: I've read you saying you don't believe and also read you speaking respectfully about and favorably about religion and its social effects. Do you feel you've missed out on something? You don't have to be a believer. There's practice and community as well as empirical belief.
Cowen: I don't think it's for me. It's like a slowed down version of Dick Cavett or something. It's too slow. It's too boring. It's too repetitive. I just think if I tried it, it would drive me crazy. And the social capital networking, like you, I have other ways of getting that. I have colleagues, people at Mercatus, people I know from blogging, podcasting, other ways. So no, I don't think it's for me at all. I think it wouldn't benefit me.
Lindsey: There's a Greek saying about the fox knows many things and the hedgehog knows one big thing. You seem like the fox par excellence, a whole bunch of different things. But did you ever yearn to be a hedgehog? Or do you think that maybe to a sufficiently sophisticated reader, there is a hedgehog Tyler there to be grasped and understood?
Cowen: I don't know. Maybe there's a hedgehog Tyler. I'm not sure I buy the distinction, but the hedgehog Tyler would be the insight that there's a certain way of living life. Or you're collecting information, you're very curious, you're traveling a lot, and there's some way of doing that and being that and showing that that is valuable. If I have any big insight, I think it would be that, which is to me quite pedestrian. But most people don't do that, and they can be quite intrigued when they encounter it. So that would be hedgehog Tyler, that point.
Lindsey: Yeah, so that's right. You're a meta hedgehog. You've got a hedgehog way of life, one big idea about the way of life. But when you think about hedgehog intellectuals, they're famous for one big idea. And that's not you.
Cowen: But Peter Singer. Yeah. No, that's not me. And I would get bored. People like that might have more impact, but I guess I'm too selfish to try to be that way.
Lindsey: When did you discover libertarian ideas?
Cowen: Oh, when I was, I think, 13. I read a copy of The Freeman from the Foundation of Economic Education around the same time that I was reading The Incredible Bread Machine. My father-
Brink Lindsey: Who wrote The Incredible Bread Machine? I never read that. I know the title.
Tyler Cowen: Susan Love Brown and three or four other people, but I think she was the main author. And my father, I don't know how, I think it was coincidentally, he had met this fellow named George Cother who even then was pretty old. You probably haven't heard of him, but he was a member of the Mont Pelerin Society. And my father said to me like, "Oh, you're interested in economics. You want to go out to dinner with me with this guy Cother?" I didn't know who George Cother was. My father could have said Mont Pelerin, it would have meant nothing to me. I hadn't heard of Milton Friedman, I don't think. But it's like, "Okay, I'll go to dinner with this guy."
We were going to a restaurant where I liked the sliced steak sandwich, and Cother told me about a bunch of these things and people and what Mont Pelerin was. That got me more interested. I read more from the public library. I read Ayn Rand, Capitalism: The Unknown Ideal. I loved that book. I was never such a fan of the fiction. But the capitalism book had a big influence on me. I read Friedman, Capitalism and Freedom, and then just kept on going down the path of what was there at that time.
Lindsey: So through high school, you were enthusing about these ideas?
Cowen: Absolutely, the whole time. Every day, every night I'd come home, I'd read. I did just enough homework to get by and then I would study.
Lindsey: At what point, when were you peak libertarian in terms of being most aligned with post-war libertarian orthodoxy?
Cowen: Maybe age 17. And I would take the bus into New York City. I'd go to Laissez Faire Books, which existed back then, and I started going to economic seminars at NYU where I learned quite a bit, even though I was only a high school kid with Mario Rizzo, Israel Kirzner, Ludwig Lachmann, that was fantastic. And you could do it. You'd just get on the bus and then the subway. So I was very lucky that I lived close enough to New York City.
Lindsey: You've since retreated from hardcore minarchism, anarcho-capitalism, libertarianism, retreated considerably. What were your first heterodoxies?
Cowen: Well, I think by the time I was 17 or so, I was realizing Austrian economics is not really a progressive research paradigm. I was more focused on Austrian economics or economics than libertarianism even though my views were quite libertarian. And once I started seeing, well, that wasn't what it was cracked up to be, even though most of what it says is true and good, you just start doubting a bunch of other things. And I think by the time I'm 19 or 20-
Lindsey: I assume you started with the idea that you would turn Austrian economics into an ongoing live research program, or did you see through that?
Cowen: Absolutely, yeah. So I would've called myself and Austrian at age 16, 17, definitely. But then you realize there's just a lot of repetition even if it's true propositions, and you get curious about the broader world. It starts being a bit like some Dick Cavett talk show and you want to look elsewhere, and you just keep on looking elsewhere and you find more in different things and your ideas just keep on becoming broader. But as economists go, I'm way more Austrian than 99% of the other ones out there. So in that sense, I'm still an Austrian economist.
Lindsey: Who were your main mentors in libertarianism? Was it going to Laissez Faire Books and going to the Rizzo seminars and getting to do those things?
Cowen: Well, all that happened and that was important, but Walter Grinder in particular was very important. And Walter, I don't know if you ever knew him.
Lindsey: Only in passing. I never got to know him.
Cowen: He was just a person who would read a lot of books, an enormous number of books, and he had a pretty deep understanding of them. And he lived not so far away. He was also in Northern New Jersey. So I didn't see Walter that many times, but he had a huge impact on me just to realize there's such a thing as leading a life of a person who reads a lot of books. And the consuming angle of it was always more important to me than what I would write or produce. Now, Walter hardly ever wrote anything. He's just not well-known. There's not much of a paper trail, but I'm always more excited to consume than produce, I think, to this day, even though I've actually produced a fair amount.
Lindsey: I feel like production is the price I pay to keep consuming.
Cowen: I feel as a producer, I'm a better consumer. So if I read things to write about them or podcast about them, I learn much more. And that's a big part of what keeps me producing, plus being paid either directly or indirectly. But Walter was a consumer of ideas, not really a producer. And that's somehow fundamental to my outlook in a way that I think people often don't get because they do see me produce a lot.
Lindsey: So was it via him that you ended up going to George Mason undergrad?
Cowen: Well, through Walter, I met a person, Richard Fink, who is still around though retired.
Lindsey: He was long time involved with Charles Koch Industries, right?
Cowen: Yes, Richard. This is before there was any connection, but he was setting up what you might call an Austrian economics program at Rutgers-Newark in New Jersey. And so I was very intrigued with that. And Rich was there and Don Lavoie, Richard Ebeling. And my first year of undergraduate, I was at Rutgers-Newark and I love New Jersey. The notion that I could stay in New Jersey, not have to live in a dorm and just keep on studying on my own, that to me was like paradise. And I loved that. I had a blast.
Lindsey: How did you then transfer to George Mason? How did that come about?
Cowen: Well, the department at Rutgers-Newark was hostile toward further growth of the program. And Richard Fink had an offer from George Mason, the offer was led by Jim Bennett who is still my colleague, though he's retiring this year. And Rich wanted to move the program to George Mason and I was keen to go along. It was just like more adventure, see a new part of the country. I hadn't been anywhere at that point.
Lindsey: A crazy thing to transfer with a department at undergrad.
Cowen: Yeah, a crazy thing. And to me, even leaving New Jersey was crazy. I had been to Philadelphia once for a chess tournament, and that to me was a big trip. So like, "Ooh, to go to Virginia." But I visited once. I took the bus down with Dan Klein and it was so different. I just thought like, "Oh, this is travel. Well, I'm going to do more of this." And it was a fun thought that I would live somewhere different. And again, I didn't have to live in a dorm. That was so central to my calculations. The idea that there's the smoke, the noise, the drugs, the whatever, so repulsed me. At George Mason, I had my own apartment which I shared with a roommate, Dan Klein. I had a car. I had a life. I had a total adult life like at age 18. And that was very important for my development. And I'm very glad I did that because people thought I was crazy that I didn't go to Princeton or something, but I think I would've been much worse off.
Lindsey: So you just spoke with evident disgust about the college party scene, and you're outspoken about the downsides of alcohol.
Cowen: Now, they wouldn't have made me drink, but the noise and the inability to sleep and wake when you want, that was really like 85% of the cost.
Lindsey: And so let me ask you about teetotaling though. Do you think... Of course there's a social element to drinking. That's why most people do it. It's a lubricant. Do you think there's anything cognitively you're missing out on by avoiding intoxication? You travel to get different prisms to see the world. You read books to get different prisms to see the world. What's wrong with altered states of consciousness as different prisms to see the world? Why is that not interesting?
Cowen: Well, I've been drunk twice. Neither time did I find it interesting. I've had some amount of red wine including some very, very good things. I think it's a very high and refined pleasure so I'm not opposed to it. I just think if you really-
Lindsey: But there are very creative people who are half-sauced all the time or who have unhealthy relationships with other intoxicants.
Cowen: Yeah, I don't know.
Lindsey: That just doesn't go into your production function at all?
Cowen: If I'm out, say, for dinner and I come home, I want to do more stuff, read more or watch more or talk with people or something, and I think the quality of that will just be higher and I'll be healthier if I've had nothing to drink. But good red wine is a very fine pleasure. I once went to an event in France where people pulled these wines out of the cellar that they plausibly claimed were some of the greatest wines of all time. And they served them to me. They did seem stupendously good. But at the end of the day, I don't feel I've lost anything by closing that door.
Lindsey: The chief medium of economics scholarship is the paper, but you're best known for books and blogging and interviews. What's your best paper, what's your most underrated paper, and why don't you write papers anymore?
Cowen: Well, I do write papers still. I just had a paper accepted at Journal of Cultural Economics on which films get censored by the Chinese government. But your general point is correct. Maybe my best paper is co-authored with Derek Parfit and it's called Against the Social Discount Rate. Most underrated paper. I don't know. Authors are very bad at judging that kind of thing. In a way, maybe they think they're all underrated. But that can't be. I don't know.
Lindsey: But there must be something that you thought you had hit the nail on the head and it didn't register with people in the way you hoped.
Cowen: I wrote a book on risk-based theories of the business cycle that has held up well and a lot of people later on have worked in the same area, and it got very little recognition when it came out. Now, that's not an article but I think that's the most underrated thing I've done.
Lindsey: Okay, that's a good answer. In your new book, GOAT, which we'll talk about more later, one of the criteria you use for judging great economists is that they can't have been too wrong about too many things. What's an important thing that you now think you were dead wrong about?
Cowen: Well, there's so many things. It's hard to know where to start. But for instance, in 2007, early part of 2008, I definitely thought the banking system was solvent. That was wrong. I then thought it was the result of a real estate bubble. Everyone leapt on that bandwagon. I now think that was wrong. I was wrong big time twice in a row. Given the way home prices have evolved, I don't think it was much of a bubble. It was maybe a little ahead of its time, but those prices seem to have been validated. So here's this event that I paid very close attention to and I'm already wrong twice in a row, and maybe I'm shooting for three times in a row wrong. So I don't know. There are so many judgments of history that unfold slowly. I think it's really hard to be sure that you are right about something.
Like when shock therapy came for Poland, I thought, "Well, this is clearly the right thing to do." I think it's enough years. You can say it definitely worked for Poland. Has it worked everywhere? The places where it didn't work, was it really tried? Was it possible in those places for it to be really tried? They're very complicated questions, but I think I would have or not would have but did underrate the Chinese model at the time. But from 2023, there's a point of view that says, well the Chinese model seemed great for 25 years but now they're stuck with a dictator and all this terrible statism, and it might still blow up in their faces or cause a world war. So I think I'm wrong there but I could actually turn out to be right.
Lindsey: As you age, not only are there your own idiosyncratic opinions that you change your opinion about, but also the things that everybody knows that then turn out to not be true. You go through that enough then you kind of get in Chou En Lai mode about everything. It's too early to tell.
Cowen: And you try your best. And you don't obsess too much on keeping score, you just try to improve.
Lindsey: Switch gears here a little bit. You've written in favor of the proposition that scientific and technological progress has been slowing down as opposed to just economic productivity growth and economic growth conventionally measured. That progress more generally has been slowing down. What evidence in favor of that proposition do you find most persuasive and what's the most persuasive evidence that you're wrong?
Cowen: Well, I think by now this is widely accepted. The CBO, the Fed, when they make forecasts, there's a general understanding that starting at some point, and you can disagree about the year, but rates of productivity growth were lower. In 2009, 2010, I had a bunch of conversations with Michael Mandel and Peter Thiel and the three of us had this idea. It was considered super weird, but now it's the mainstream view. And I actually think it's probably not true anymore. I would say this with some caution. But if you look at AI, mRNA vaccines, a number of other advances, I strongly suspect we're out of that era and into some new weird time but where the pace of change has accelerated again. But I guess I see like 1973 up through, I don't know, 2016, 2017 as yes, a great stagnation with lower productivity growth. And I think that's a pretty easy view to defend. It's become boring.
Lindsey: But productivity growth can slump because your high productivity sectors shrink over time because of Baumol disease effects. So you can maintain the same pace of technological innovation and just succeed your way into slow productivity growth. Correct?
Cowen: That's true. I don't-
Lindsey: Just slow productivity growth doesn't necessarily mean innovation and technological innovation are slowing down. Those are two different things, right?
Cowen: Yes, that's all logically correct. But I don't feel the Baumol disease has been the main issue. It's an issue for sure, but I think the main issue I'm inclined to think is every now and then, you have a general purpose technology which way back when was fossil fuels. And you do everything you can with that general purpose technology but you hit diminishing returns and you've got to wait till the new general purpose technology comes along.
Lindsey: And Robert Gordon's story is the late 19th, early 20th century had four.
Cowen: I agree with that. It's a great book.
Lindsey: We only had one in this, the information revolution.
Cowen: It depends how you aggregate them. Computers and the internet, is that one? Is that two? Does AI make it three? Is it still one? I don't know. I think it's a less broad breakthrough than what we had earlier. Like it is not revolutionizing all sectors, but it's revolutionizing a bunch of sectors, and maybe over time it will be all sectors. So I think it will prove quite important.
Lindsey: As far as what was going on during this great stagnation, on the one hand it's an exhaustion of low-hanging fruit, that's the metaphor you made famous in your book, but it's also can just be a dry patch, right? And as you explore the landscape, you hit upon this one general purpose technology and you explore it for all it's worth, but it takes more exploration to find another one. So it could just be that we were wandering for a while.
Cowen: Yeah, I think those are basically the same explanation. Now, on top of that are 17 other factors. One is the Baumol cost disease. We over-regulated a number of sectors. We gave up on nuclear power. There's a long list. I'm sure you've heard it. You've contributed to the list in fact, which I would agree with your contributions, and it all hit us more or less at once.
Lindsey: And to what extent do you think do you blame or do you see as one of the causal factors inefficient funding of science or dysfunctional funding of science?
Cowen: Patrick Collison puts a lot of weight on that. I have an open mind, but he hasn't yet persuaded me it's as important as he thinks it is. And I also view it as a bit endogenous that you start funding science less well when you see less value there and you take fewer chances. But still over time, I could imagine coming around to that point of view. I do think it's one of the factors but I don't think it's the main factor. It's one of the 17.
Lindsey: All right. So now though, we've got a bunch of exciting new technologies that seem to be looming on the horizon.
Cowen: Not just looming, they're here.
Lindsey: Give me you're bullish or-
Cowen: They're here. It's in my arm. I have three shots. They work.
Lindsey: Okay, that's fair. But there are other ones that are looming. And I want you to tell me if you're bullish or bearish about them in your lifetime. So non-traditional nuclear, new nuclear designs, whether it's small modular or different reactor designs, whatever, something to reignite fission.
Cowen: Bullish for the world. I'm not sure about this country. Our voters and our NIMBY types simply may not want to do it. But if you're Africa and you're tired of paying hard foreign currency for fossil fuels, I think a lot of those countries will do it, or South Asia, other places. So bullish. But am I going to see one in Fairfax County? I'll say no.
Lindsey: How about fusion?
Cowen: Eventually, it will work. Look, most of the energy in the universe seems to be produced by fusion, dark energy aside. So in some sense, it has to work. I just don't know how long it will take to get there. The smart people I know are pretty bullish.
Lindsey: The story in our life is that it’s always been 30 years away. Has the countdown begun?
Cowen: Some of these areas, I judge by the number of very smart young people they attract. And I see fusion attracting those people in a way it never has before. So I'll say bullish but with high uncertainty.
Lindsey: How about advanced geothermal?
Cowen: Well, if some of the other things come through, we won't need it. But in principle, it should be possible. I'd give that a 20% chance. If none of the other stuff worked, I'd give it an 80% chance. But it might just be out-competed by nuclear and fusion and cheap solar and some gas on the side to resolve intermittency problems, some wind. So we might not ever get-
Lindsey: Any worries about it causing seismic problems?
Cowen: I don't feel I know enough to judge that, but I don't see why it has to just from a layman's point of view. It's a problem we maybe could solve.
Lindsey: How about space-based solar? Is that a solution in search of a problem? Or if Starship pans out and launch costs continue to go down, is that would be the mechanism through which that would make sense?
Cowen: Well, I think the other things will work first. And I get very nervous about energy sources that can very directly be used as weapons. I'm not sure it's wise to pursue it. So I would put it on hold because it leads to a new arms race if it works.
Lindsey: How about gene therapy? We've been rubbing our hands together and anticipating miracle cures since the '90s, and they've been slow coming.
Cowen: AI is much more powerful now so a lot of that stuff is going to work. There are massive regulatory obstacles, but I feel in the long run, people want these therapies or they want fixes for their kids. And it will happen. They're way slower than they ought to be and probably I won't see that much of it in my lifetime. But I would say bullish. It may not all work out for the better also, right? So re-engineering the human race, that's a task fraught with danger and it might be like on net positive expected value, but it does make me nervous.
Lindsey: All right, let's switch from exciting technologies to the slowdown and what's been behind it. Do you have any plausible story that explains decades of measured negative productivity growth in construction? That just blows my mind and I don't understand it.
Cowen: I think about this a lot and I don't. And Brian Potter who writes a Substack on construction, I'm sure you know it, we supported him with Emergent Ventures to do that. But a lot of processes do get worse. If you work in a university, you can't help but see this. Clearly, a lot of things in my university are less productive than they used to be. Now, construction is the market. It's for profit. It's very different. But still I have some intuitive grasp of how things can get kludgier and worse, and you do too. So that would be my guess.
Lindsey: What is it about the construction industry that immunizes its kludginess from competitive attack?
Cowen: Well, our real talents have gone into the digital realm and into finance and not into a lot of physical areas. So it's not a talent magnet. And local government is involved, which is a nightmare. There's NIMBY. You don't really have to be that fast in a way. The stock is high enough relative to the flow. The social pressure to be fast and cost-effective is not that high. You buy the thing on borrowed money. You don't really understand what it's costing you because you just look at the monthly payment. So a lot of forces kick in to make that market less competitive, less efficient. But I agree, I don't understand it. They're just some factors I would cite.
Lindsey: So is NIMBYism with us forever? We've got a YIMBY movement now. It's been making some real headway, some real policy gains at the state and local level. But it's a mammoth battle. So 25 years from now, are we still talking about housing shortages and ridiculously high infrastructure costs or have we somehow or another succeeded in disciplining the vetocracy?
Cowen: We're still talking about it. I think it's an eternal push and pull. So just as NIMBYism has spread to Austin, I expect it will spread to Houston and Dallas, Atlanta, other places. But we'll have new areas of growth that will be pretty YIMBY and it'll be ebb and flow. This is a big enough country. I think we'll do fine. I would prefer more YIMBY. But if there's any country that can get away with the nonsense we pull, it's the United States. It's much worse for the UK where there's the London Oxbridge area and then after that it's like, "Whoa, I don't want to put my stuff there. "And they're having trouble building out anything comparable to their top cluster. But here, there's even an upside to NIMBY. You have to create a new Nashville every so many years, and we do that very well.
Lindsey: I agree with you that it should matter less in America. And yet the Enrico Moretti/Hsieh findings of these eye-popping GDP losses just from New York and the Bay Area, that their NIMBYism has cut US economic growth in half over the past half century. That's basically their finding, which is...
Cowen: Those numbers don't hold up. There's a recent critique and it seems those estimates are wrong. So we don't know the size of the costs.
Brink Lindsey: That's fair, right? That's a possible explanation of that, right?
Cowen: Yeah. But one thing they don't really take account of is that when your top centers are NIMBY-esque, that you have to go somewhere else. And there's some value in that diversity. Just like we ended up with California, then we ended up with stronger Texas, stronger Florida, stronger Nashville, and you get innovation from being geographically diversified. The papers I see don't count that. I'm not sure how big it is. But again, I take that very seriously.
Lindsey: That's an interesting point. You wrote The Great Stagnation, but you think we may be coming out of it right now?
Cowen: Out of it, not coming. Again, three shots in the arm. That saved a lot of lives. To me, that alone and the notion that the vaccine in some sense was designed in a day. I know with a lot of years before that point. But that's really remarkable. And I spoke to a lot of experts around that time and many assured me like, "Oh, this will take four or five years, maybe 10 years."
Lindsey: Yeah, okay. The great stagnation and measured productivity growth you say we may be coming out of that. And that's a different matter from mRNA vaccines.
Cowen: Very recent numbers on productivity are very high. It's a short blip, but they certainly don't counter the view that we're out of it. And maybe some of our gains show up in labor supply and lives rather than productivity. So let's say longevity works, which there's some recent results that are positive, and everyone lives an extra six years. That could even harm measured productivity growth, but clearly we're all a lot better off. So some of our current and future gains may not show up in productivity growth, but there are indirect growth in utility productivity.
Lindsey: I think great gobs of our improved welfare don't show up in productivity growth. There's a paper that says that the life expectancy gains from 1900 to 1950 basically equal GDP during that period in terms of consumer surplus.
Cowen: Yeah, that's plausible. Now, recently, as you know, life expectancy has been falling, but I think it's going to be rising again. So I'm optimistic there.
Lindsey: But will measured productivity growth ever return to post World War II, Golden Age highs? And if not, is that simply because we've just been too successful in growing or would it be a failure if we never get back there?
Cowen: I think due to AI and some other advances, we might end up with rates of productivity growth above 2% rather than as they at times were at 1%. Compounded as you know, that's an enormous difference. So are we going to hit 3 to 4%? I guess I'm skeptical but it wouldn't shock me. Especially with AI which can develop quite rapidly as it trains itself. It's possible we'll have these remarkable bursts. I don't know if I'd bet on it, but again, if it happened I wouldn't be shocked.
Lindsey: I want to ask you about the Flynn effect and what is apparently now a reverse Flynn effect. IQ scores are normed so that the median score is 100, but if you look at the raw scores over time as James Flynn did, you discover that over the course of the 20th century, raw scores were going up. Now apparently, raw scores are going down in a bunch of different countries.
Cowen: It worries me that they flattened and maybe they're even going back down again.
Lindsey: Correct. So for the initial rise, what do you make of that? What is that telling us about how people changed?
Cowen: Everyone is puzzled by this and it's especially odd that it's on the Ravens Matrices tests. That's where the gains really are, not in accumulated knowledge. My best hypothesis, and I say this with very little support, is there is something about the complexity of the world, our TV shows, our visual environment, how we network, that just exercises our brains more. But maybe that's asymptoted. That's a guess.
Lindsey: Yeah. So now it's either asymptoted or we may actually be going down if IQ scores are falling.
Cowen: If it's going down, and that in my view is not well measured but it's possibly true, it would be because of stress and mental health problems would again be my guess. Not because the visual environment is becoming less complex, but something else is interfering with our abilities to process effectively. And you see a lot of evidence for higher rates of mental health problems in this and some other countries.
Lindsey: So even when the Flynn effect was going, reading comprehension scores weren't going up. And that makes sense because people have been reading less.
Cowen: I don't know if people read less. I'd like to see the numbers. You might be right. They read books possibly less, but they read stuff on their mobile devices an awful lot.
Lindsey: Yeah, that's true.
Cowen: And maybe that doesn't help them. It might hurt them. I get that.
Lindsey: I would hazard that there's a pretty huge gap in complexity between reading books and reading texts.
Cowen: But people read a lot online that's not texts. And a lot of the books that sell well are stupid. So you might be right, but I'd love to see someone look at it very closely.
Lindsey: Yeah, I agree. The obesity epidemic, is it just cheap calories or is there some chemical poisoning, some additive that's going into our system that we don't know about that's affecting our metabolism? Or is it both?
Cowen: Cheaper food, food that's easier to prepare. Now some of my friends are quite convinced there has to be some other secret factor, but I'm still skeptical. I'm open-minded. But I want to see one good research paper that actually points to it and has evidence. And if I see that, I'm willing to flip. I'm not dogmatically against the notion. But until I see it, I'm just not there.
Lindsey: There seems to be an inflection point in the '80s where people started getting fatter faster and the mystery is what happened in the '80s. What explains that acceleration in weight gain? And I have no idea. There's lots of theories.
Cowen: But a lot of things in human affairs, including mental health problems, I think are issues of contagion. So I become a bit more that way. That influences you. You influence others. And in models with contagion, small initial changes lead to big final effects, and it's very hard to trace the big final effect to a cause. So maybe that's why it's a mystery, not that there's some mysterious chemical wrecking us.
Lindsey: Let me talk about the global fertility collapse. Population right now is a little bit over 8 billion, which is about five times greater than it was in 1900. But fertility and birth rates have been falling since the '60s and falling precipitously. Now, about 50% of the world lives in countries with sub-replacement fertility rates. The UN's current prediction is that population will peak at 10.4 billion in the late 2080s. But there are other estimates that see a lower peak sooner. Do you have any sense of...
Cowen: Well, this worries me greatly as it does Elon Musk and some other people.
Lindsey: Me too.
Cowen: It's fine if the world just has fewer people, but you want to bound on that decline and I don't see what the bound is. So right now in South Korea, measured total fertility just felt to 0.7. My goodness.
Lindsey: It's just astounding.
Cowen: I recall thinking five years ago, 1.3 was impossibly low. Now that feels like a house full of kids. So my friend Robin Hanson thinks the only way out of it is to have a world full of Amish or people with what to us seem to be quite strange norms. Maybe we evolve those. I don't know. It's a big concern but I don't know what I can do about it. And in that sense, it's not an issue I'm proactive on.
Lindsey: Yeah. If there's not a solution, there's not a problem. It's just a condition to behold.
Cowen: But if n goes to zero and along the way maybe innovation shrinks, right, this could be terrible.
Lindsey: Yes. So how about the US?
Cowen: Far enough away.
Lindsey: So right now, in the US our population has been buoyed by immigration, but immigration is down. So the most recent projections are that we could actually start having declining population by the end of the century. So put those two things together, fertility rate and US immigration posture. Are we still increasing population by the end of the century or have we joined the world in shrinking?
Cowen: I don't trust any projections that far out. I would just say the US is the country I worry about least. We have a good track record on assimilating immigrants. We could just kidnap people from Canada if we had to, right? They would be defenseless. We have a lot of ways of coping with it. We can get the best from a lot of other places, even if immigrants from those countries create problems. If we take in only the best, US can do that, I think it's really the rest of the world that should be worried.
Lindsey: You mentioned the possible productivity impact. That is that there's growing evidence that slowing population growth rates are bad for productivity growth. Of course we know that slowing population growth rates are bad for aggregate economic growth. You've got less population input, you're going to have less production output. But also shrinking populations seems to be bad for productivity growth. So how does that affect your assessment? We may be coming out of the great stagnation. We may be coming out of it just to go right back into it.
Cowen: It's quite possible. But I would say I'm confused about the rate effects versus the level effects. In history, as you know, there were so many examples of small groups like ancient Athens, Renaissance, Florence doing amazing things. So maybe the level matters a bit less than we think or Paul Romer might've told us. But if the level doesn't matter that much, why should the rate matter so much? I don't know. I think we don't understand it much.
Lindsey: Do you think is AI a potential deus ex machina here? Can we just make artificial workers to substitute for the real workers we're not creating?
Cowen: Take away the word potential. The deus ex machina is here. A branch of Google just today announced they discovered thousands of designs for potential new materials. There's all this work on protein folding. So AI is advancing science now.
Lindsey: Sure, but-
Cowen: That's going to accelerate.
Lindsey: But you just said you're worried about the effect of population shrinking on productivity growth. So you're not sure that AI will bail us out.
Cowen: And I'm also worried that there's just fewer people around to enjoy what the AI does for us. Say AI is amazing and there's 17 people all like in the state of Rhode Island. What good is that? It's only 17 people.
Lindsey: My concerns about population shrinking go beyond economics. It just feels like something very dark and dispiriting that-
Cowen: I agree.
Lindsey: ... the human race finally got rich. We finally made it where life is tolerable for ordinary people. And our reaction to that is just to check out, not keep the party going?
Cowen: Yeah, collective self-immolation.
Lindsey: That's really depressing.
Cowen: It's a very strange development that not many people had anticipated.
Lindsey: You mentioned one possibility for population rebound, the non-reproducers vanish and we end up with Amish people who reproduce a lot.
Cowen: Orthodox Jews, right? Other groups.
Lindsey: One possibility is, and you can imagine new religious inspiration being drawn from a shrinking world and seeing that Babylon has not worked. Babylon is dying. We need to get back in touch with God and make people again and leave this wicked place behind us. You can picture that kind of reaction. But there's another deus ex machina besides AI that could get us out of population decline and that's artificial wombs. And I don't hear anybody talking about that. So we're pretty close to that technology. Think about if you're China.
Cowen: But you still have to raise the kid. Who brings the kid up? I don't think the womb is the tough part. Who wants to go through the kid being there? Maybe kids are not fun enough. This is one of my fears.
Lindsey: Picture industries, nonprofit industries that raise kids for a cut of the tax revenue that they generate. We produce Scotch and put it on shelves for 12 years before selling it. We can produce kids and keep them on the shelf before 18 years before selling them. Isn't there money to be made in raising kids?
Cowen: It could be that AI creates a big enough surplus that the government pays people to perform the job of raising kids and pays them a real salary, almost commensurate with what they would earn elsewhere. That could happen.
Lindsey: But that's still-
Cowen: It's still a weird outcome. I know I –
Lindsey: There's still parenting labor there. Do you not see the possibility of industrial parenting?
Cowen: Maybe, but you don't want the kids to be too screwed up. And we have evolved, I think, to come out better when we have, quote-unquote, real normal parents rather than, "Oh, I was raised by Tesla Corporation," or something.
Lindsey: I agree. It's a dystopian idea. But I think if I'm China, right now I'm right up there. I've regained respect in the world. I'm a major power. I may be the biggest economy in the world. I'm innovating at the frontier in important areas. But now it's all about to go away because my population is shrinking. Are they really going to stand for that if they could find a technology to make babies?
Cowen: I don't know what they can afford. China's in a much worse position than we are and they don't attract immigrants nearly as well. That would be one of the places I'm most worried about. And of course Korea, Japan, the usual.
Lindsey: All throughout Asia, it's remarkably advanced.
Cowen: Yeah. But then you have these other countries like Iran which are quite poor and their fertility is just plummeting. I just checked Brazil's rate a few weeks ago, which 1.5. And you think, "Oh, everyone's in some big family there," but not looking forward.
Lindsey: Thailand's 1.4, I think.
Cowen: Okay, same basic deal. So those are the huge problems, not the US. But the fact that the US needs more people will make it harder for Brazil and Thailand because we're going to suck away some of their new people.
Lindsey: Sure, of course.
Cowen: I think it's bullish for the Anglosphere and really, really hard for everyone else.
Lindsey: We see it. In Japan, you have shrinking population. But Tokyo isn't shrinking, right? So you're going to have people. Population shrinking is going to be very lumpy that you're going to have huge back countries that are completely abandoned and a few cities that pile up and then a few countries that pile up with other countries emptying out. But with population shrinkage, I don't think will proceed smoothly across the board, it will be very lumpy.
Cowen: I've heard there are already decent houses in rural Japan that basically are free.
Lindsey: Yeah, okay. Let me switch gears to one more set of topics before we wind up. In your book Stubborn Attachments, which is your personal vision of your personal philosophy, you open the book with these words. "Growth is good. Throughout history, economic growth in particular has alleviated human misery, improved human happiness and opportunity, and lengthened human lives. Wealthier societies are more stable, offer better living standards, produce better medicines, and ensure greater autonomy, greater fulfillment, and more sources of fun."
So my question for you is how robust now is the connection between economic growth and overall human welfare, what you refer to as improved happiness and opportunity, greater autonomy, greater fulfillment. Until quite recently, I would've agreed wholeheartedly with that passage without even batting an eye. But now, I feel differently. In the 21st century, we've seen, continued to see rising material living standards. But a whole bunch of other welfare criteria seem to be going in the wrong direction. We've talked about a few of them. Obesity is up. IQ scores may be going down. Life expectancy down. Suicide and mental illness up. Marriage down. Friendships down. Community involvement down, sub-replacement fertility. So I can grant that the connection between economic growth and overall welfare gains was very strong during industrialization and the transition from mass poverty to mass affluence. But since the 1960s or so, when mass affluence was well-established, to me, the connection seems to have weakened. Do you agree or disagree?
Cowen: I think you're overstating some of those trends, but I would put it this way. A bunch of bad things are going to happen no matter what. And do you want to face those bad things as a wealthy society or a poorer society? Even if you compare US to South Korea, South Korea is a fully developed nation but I guess it's per capita incomes about 65% of ours. I just think we're in a much better position to address our problems than South Korea is. It's not a guarantee ex-post that we're going to nail it, but which hand of cards do you want to be holding? I would say it's that of the wealthier society.
Lindsey: That's fair. Let me ask the same question from a slightly different angle. Well, my Substack, which is called The Permanent Problem, my starting point is a distinction drawn by one of your GOAT finalists, John Maynard Keynes. In his essay “Economic Possibilities for Our Grandchildren,” he argued that capitalism was in the process of solving the, quote, economic problem, which he meant keeping material deprivation at bay, but that this was bringing another problem, humanity's permanent problem into view. And that problem in Keynes's words was how to, quote, live wisely and agreeably and well, close quote, with all the resources and powers that modern science and organizational techniques have bestowed upon us. So the premise of my Substack is that capitalism has triumphed in solving the economic problem, but that it's floundering in the face of the permanent problem in the 21st century.
My question for you is do you agree or disagree with Keynes that the economic problem and the permanent problem are two different things? It would be easy to object that the economic problem really never gets solved since human wants are inexhaustible and therefore scarcity in the sense that matters to people never goes away. And we always need to economize so we always have an economic problem. Or you could argue, as you appear to do in Stubborn Attachments, that the two problems are functionally indistinguishable. That if you focus on maintaining growth, you're in a better position to deal with all the other plural goods of human welfare and that they will fall into place more naturally with higher growth than otherwise.
Cowen: Well, I would tend to side with the latter, and indeed you cite me as saying that. I would look at it this way. You mentioned Keynes. I think Keynes had an ideal of a particular kind of life where you would cultivate the arts, you would read, have a lot of time to talk to people, and also that you had the option of being gay if you were so inclined. And today's world for all of its faults, putting aside COVID which is more or less over, I just think there's much more of that now than in Keynes's time. And I don't just mean that China and India are richer, though those are huge effects. But say even within North America, the number of people who have those options and indeed exploit them is so much higher than in say the 1930s.
So it's easy to see what is wrong, but we shouldn't forget how much progress we've made. Even creating Keynes-like lifestyles for many, many more people. How many people even had an academic lifestyle in Keynes's time? How many schools were there that could de facto give you a kind of tenure, reasonable teaching load, and a salary of more than 2,000 pounds? Not many. Just Cambridge, Oxford. And then you're like... LSE is coming along. But now, a lot of people have a version of that, as do you.
Lindsey: Let me ask you a follow-up question about Stubborn Attachments, which is basically about the importance of growth. Growth in what isn't always clear to me. You frequently talk about economic growth, but then you define growth is growth in, quote, wealth plus. And wealth plus includes not just GDP, but it includes leisure time, household production, and environmental amenities. So that wealth plus is a really vague target depending on how you weight the relative importance of traditional GDP versus leisure and household production and environmental amenities. I could picture both a Marc Andreessen style accelerationist and a Jason Hickel style degrowth-er arguing that their policy prescriptions maximize wealth plus.
So my question is how do we figure out the correct weighting of wealth plus? How do you weigh the relative importance of the prosperity of high GDP versus the quality of leisure versus the capabilities development and self-sufficiency you get from household production versus a clean and flourishing natural world?
Cowen: For most practical purposes, I think wealth plus is very close to maximizing the rate of GDP growth narrowly defined. There's some papers by Charles Jones where he looks at the correlation between just raw GDP growth and other goods, and it's well above 90% depending on various definitions. I'm pretty happy with GDP growth. Now, you can't take that as literally true because it's very easy to cite counter examples. So I say wealth plus. But again, practically speaking, it's the countries with high GDP growth and today high GDP levels that are good. There's a qualifier. If it's all oil wealth held by a few family members, of course that's different, but everyone gets that GDP growth works very well.
Lindsey: Okay. So you've just written a new book, and it's not just a new book but you say it's a new kind of book, a book meant to be read with AI. It's called GOAT: Who is the Greatest Economist of All Time and Why Does it Matter? I've read through most of the book and I found it just completely delightful. I loved how personal it is, how much of Tyler we see in your assessment of all these greats. Because you write it as a fan, a fan of economics, and it's a wonderful approach.
On the other hand, I played around a bit with the AI part, and on the whole I found that underwhelming in a way that I generally find ChatGPT underwhelming. Every time I use it, I have these twin reactions that, "This is a total miracle. I can't believe I live in a world where this is happening," and, "What I'm reading is just impossibly boring and I can't read another word of it." So the ChatGPT persona, that fake HR-speak tone, I find so boring. And it contrasts so vividly to me between that and the very personal Tyler I was reading that I didn't get a lot out of the AI add-on. So do you really think this is the new form of book or have you come up with the equivalent of 3D glasses and scratch and sniff for the movies?
Cowen: I think it's the new form of book. One thing to keep in mind is you're an unusual reader. So if you read about Keynes and the Treaty of Versailles, you have enough background knowledge. That makes perfect sense to you. A lot of people don't. So you can use the GPT to just ask, "Well, tell me about the Treaty of Versailles." Now, you don't need to do that. GPT is very good for that kind of query. Some readers such as yourself or say Doug Irwin, who's read the book, Russ Roberts probably they should just read the book. But a lot of people, for one thing, they don't want to read the book. They just want a summary of some of the chapters or they might want anecdotes to take to a cocktail party. We don't like to admit it, but that's probably 80% of our readers. And GPT does that wonderfully or it gives you background knowledge wonderfully. So I would say you know too much.
Lindsey: I regularly Google when I read because there's stuff I don't know and want to know more about. And so I can picture that being helpful in those times. And certainly books I don't want to read all the way but I want to get the gist of, that's helpful. I used to read book reviews. They helped. They did the same thing.
Cowen: Yeah, GPT has replaced 80% of my Googling, I would say.
Lindsey: In the book, you claim, I won't give away spoilers as to who is the GOAT, but you claim that whoever it is, all the serious contenders are already dead and there will almost certainly not be serious GOAT contenders in the future. This seems to be due to a combination of specialization – you just can't attain the same level of profundity as past greats because the questions have become too narrow and the conceptual architecture is too built out – and the maturation of the field, lots of foundational ideas and principles and techniques have already been developed. So if there can't be an economist GOAT in the future, what fields of intellectual endeavor still have the possibility of having the GOAT in the future?
Cowen: Before answering, let me first say for our listeners, if you want to read the book, it's online, it's open source, and it's totally free. You can read it with or without the AI, and the site address is econgoat.ai, or just Google "Tyler Cowen GOAT" and it will pop right up. So you can read the book. An area like cosmology or unification of quantum mechanics and general relativity which so far seems to have failed, maybe someone will do that and that person would be a GOAT of something. That would be one area. There's plenty of areas I don't know very well, like say chemistry. I don't know what are the prospects for a GOAT of chemistry. It seems to me maybe not likely, but if something in nanotech were a huge breakthrough and alchemy worked, that person or more likely that team would be a GOAT. So I think there's plenty of areas where GOAT-like creation may still happen.
Lindsey: Any possibility that there will be a future GOAT economist, but he's an AI.
Cowen: I think AI will be extremely useful in economics, including finding patterns in data, or it's already used in mathematical finance. I'm just not sure there are that many new theories to be found no matter what the smarts embedded in the machine. So I don't think it will revolutionize economics, but I think eventually we'll use AI to simulate economies and that will be a new method of economics. And I don't know how well it will go, but I think that's actually the frontier. Start small, start with the village, collect all the information about the village, feed it into an LLM connected to some mathematical sophistication, and start asking it questions about how the economy works. And it's like a souped up, hyper-economic anthropology, and I think we'll start seeing it within our lifetimes.
Lindsey: Well, that's a wonderfully interesting and exciting note on which to end. Tyler, it's been great talking to you. And everybody, go read GOAT: Who is the Greatest Economist of All Time and Why Does it Matter? It's free. It's on the internet, and it's awesome. Tyler Cowen, thank you so much for taking the time to talk with me
Cowen: Brink, thank you very much. Take care.
Interview with Tyler Cowen