In 100 Years: Leading Economists Predict the Future by Ignacio Palacios-Huerta (editor), The MIT Press, 216 pp.
In 1930 John Maynard Keynes published an essay entitled “Economic Possibilities for Our Grandchildren,” envisioning a surprisingly rosy future from the midst of the Great Depression. Keynes took an academic view of the Great Depression as a passing economic moment and projected trends 100 years in the future. Ignacio Palacios-Huerta, professor of management and strategy at the London School of Economics, has gathered a group of top economists, including several Nobel laureates, to revisit this thought experiment 84 years later. Although Keynes was looking to 2030, many of his projections have already been exceeded by the time of publication in 2014. In a few cases, Keynes' projections have been grossly disproven, such as an experimental test of economic assumptions on human behavior. From this starting point, the contributors to this book give their own projections for the year 2114. The 10 essays contained in this book offer a variety of methodologies for looking at the next 100 years based on their areas of expertise. Although the authors approach the topic uniquely, reading the essays in quick succession leads to common threads emerging.
The two most prevalent topics in the essays are climate change and economic inequality. In analyzing Keynes' 1930 projections, a consensus view is that Keynes was too conservative in projecting economic growth and accounting for the rapid advance of technological innovation. The relative prosperity experienced by the average citizen of the developed world far exceeds even Keynes' most optimistic projections. This positive trend is tempered by the growth of income inequality that Keynes also did not envision. Economic prosperity, when the human race is viewed as a whole, has increased greatly on average. However, the outliers have skewed the sampling so that a simple average does not account for the vast disparity between the most and the least prosperous. The consensus view of the essays in this book is that this trend will continue and will be exacerbated by the projections of climate change.
Several authors advocate enforced reductions on the part of developed nations in order for all developing nations to achieve parity. Conflict over resources necessary to sustain the economic growth experienced in the twentieth century is assumed, if not by clash of arms, then by economic gamesmanship. The growth and concentration of current wealth in a relatively small number of people (the so-called 1 percent) is not a feasible goal for the remaining 99 percent to achieve. A common thread among the various projections is that the human race, in total, will be more prosperous in 2114 than it was in 2014. However, on an individual level, this generally means reaching a relative prosperity. The poorest people in the world will be much better off in 2114 than in 2014, although their success will be a far cry from the wealthiest people of 2014. In a similar sense, the wealthiest of 2114 may not be as well off as their 2014 counterparts. This does not mean a leveling of the field, only an assumption that the current trends of the extreme wealthy are unsustainable.
Overall, this work describes trends and projections that are much more conservative than anything Keynes projected in 1930. The authors stay on safe ground and avoid projecting anything that is not a linear outgrowth of current activity. In 2014 they view the future as a stable continuation of the present. Conflict over economic disparity is a problem in 2014, and it is assessed to continue. Resource competition is a fierce economic battle in 2014, and it is assessed to continue to be fought in economic, political, and potentially military battlegrounds. The best essays in the book imagine the sources of such conflict and offer potential solutions. The worst essays take a pass on offering any projections of substance and opt to simply report current trends. It is important to remember that these essays are not prophetic. In this sense, the title is a misnomer, and the book is not about the year 2114 at all. Like any good futurist work, this book is really about the present day. The essays clearly lay out current economic challenges, and most take a strong stand that simply maintaining the status quo will not work. In this sense the book is informative and will provide an excellent background on economic issues that either are or will soon be matters of policy debate. A reader looking for a primer on economic policy would be well served to read this as a starting point, although many of the topics may be familiar to a student of economic trends.
1Lt Jonathan D. Strawn, NMANG