This post is by Tamsin Murray Leach of UCL’s Institute for Innovation and Public Purpose (IIPP-UCL).
There’s a lot of misunderstanding about what we mean when we talk about innovation, or technology, for that matter. Popular (mis)conceptions interpret it both to mean gadgets and robots, while governments promote ‘innovation’ as an economic panacea, focusing on invention and entrepreneurship. Yet the broader sociopolitical context behind technological change is often overlooked. This is especially true when it comes to the major shifts in lifestyle that have taken place with each technological revolution.
The cycle of technological revolutions
Our research at IIPP builds on the schools of economic thought that have looked at the cyclical, or wave-like patterns of economic prosperity and depression. Professor Carlota Perez links this to five revolutions in dominant technologies and their accompanying infrastructures: from the mechanisation of the cotton industry and the canals that drove the first ‘Industrial Revolution’ to the microchip and internet network that has revolutionised our current era.
The initial decades of each revolution are the predominant period of what has become known as ‘creative destruction’. Driven by a powerful cluster of new and dynamic industries and infrastructures, a myriad of innovations — technological, procedural, institutional, societal — battle it out for investment and uptake. These surges of activity eventually lead to major structural changes in production, finance, distribution, communication and consumption. However, in each of the five revolutions Perez describes, the early installation period of the new technologies has always culminated in a speculative bubble, followed by a major crash and subsequent depression.
It is at this point that the future promised by new technologies looks both uncertain and threatening. Deskilling and job losses occur across industries and regions, while the new industries provide higher productivity but less employment. Investors, accustomed to the high returns of the early days and scalded by the crash, become risk averse, particularly for long term investment in production. It is the moment in the cycle when something must happen to foster investment, employment and innovation, and for the installed potential of the new technologies to lead to major structural changes.
Changes to lifestyle, jobs and well-being
This is where the importance of lifestyle change comes in. New products and services that become possible with each technological revolution are often overlooked, seen as simply by-products of progress. Yet it is these new products and services – new industries that are ‘complementary’ to those of the new technologies themselves – that create demand and actually become the major source of new jobs and well-being.
In the early 19th century, the shift was to city-based Victorian living. The new British industrial and commercial classes established an urban lifestyle very different to that associated with the country-based aristocracy. While the maintenance of public health in such crowded conditions cut across all classes and led to the public provision of adequate streets, lighting, water and sewerage systems, new businesses found inexhaustible demand in the growing numbers of city dwellers, who, in turn, served as testbed for export markets. By the end of that century, in the age of steel and heavy engineering, the Belle Époque in Europe (in parallel with the Progressive Era in the US) encapsulated the good life of the day. During this first period of globalisation, the upper and burgeoning ‘professional’ classes of the west established a cosmopolitan lifestyle: of transcontinental travel and intense flows of information. Publishing flourished, as did public entertainment. Cities grew upward, lit by electricity and connected by telephone.
The smart green good life
We are still experiencing the aspirations and repercussions of the last major lifestyle shift today: the suburban lifestyle of standardised mass consumption, based on the technologies of oil, plastics and mass production, which fuelled the post-war boom of the twentieth century. In response, the notion of a green, or sustainable lifestyle, began to gather momentum in the 1970s, the same time as the ICT revolution was just beginning. Yet at the time, ‘going back to nature’ seemed like just that: going backwards to a niche lifestyle that appeared the opposite of an emerging digital future filled with shiny hi-tech gadgets.
Since then, microchip-based technology has decreased in price and spread across the globe, becoming integral to the lifestyle of the majority. At the same time, awareness of rising and converging environmental pressures has gradually increased support for green living. What was once considered the choice of hippies, ascetics and bumbling do-gooders is now an aspiration: hybrid cars and biofuel buses are becoming the norm; the so-called sharing economy has been captured by corporates such as Uber and Airbnb; the major supermarkets cater to plant-based diets, while ‘artisan’ produce sells at the premium end of the market.
Far from being oppositional, this aspiration to be green has instead resulted in the gradual emergence in the mainstream of what Perez calls today’s ‘smart green good life’. Where economies of scale once relied upon standardisation of both supply and demand, now variety, specificity and adaptability are easily handled with the technologies of ICT. Health and education are becoming increasingly individualised. As resource scarcity looms, people are turning from ownership to rental, and from material products to intangible goods such as experiences and digital entertainment. Indeed, if stimulated by government policies that encourage a convergent direction underpinned by the model of a smart green good life, the transformative nature of technology is capable of reducing tangible content and enabling innovation across the whole production spectrum, from the extraction of natural resources to manufacturing, distribution, logistics and reuse.
While this new good life, like those before it, has arisen from the interaction between our current context and the possibilities that the current crop of new technologies provide, our research at IIPP-UCL also suggests that its success in stimulating demand is not down to technological determinism. Rather, lifestyle shifts are a sociopolitical choice, and the result of the interplay of markets and state action (as Mariana Mazzucato has argued). As was the case during the shift to mass consumption, government policies are necessary to tilt the playing field in the direction of these burgeoning lifestyle preferences. Today, Europe is in a position to adopt this emerging smart green way of life as its own, and to play a formative role in fostering local and global prosperity through sustainability.