We have written before about the notion of technological revolutions (e.g. the steam engine, electricity or IT) and how these revolutions, for better or worse, have radically reshaped the economy, society and our everyday lives. In a recent paper, scholars now argue that these subsequent revolutions can also be regarded as a single “Deep Transition” to industrial modernity. Moreover, they claim that we are on the brink of the next Deep Transition to a more inclusive and sustainable economy.
- Among other scholars, London School of Economics professor Carlota Perez defines five technological revolutions with roughly similar macro-economic and financial dynamics. Each wave, or surge, results in a new “techno-economic paradigm” consisting of generic technological and organizational best practices. E.g. the widespread use of the automobile and the rise of individual mobility.
- In From Luxury to Necessity, our team-member Sjoerd Bakker describes how these revolutions changed our everyday lives and our patterns of consumption. In a previous note, we also suggested that the next technological revolution (based on AI, 5G and quantum computing) is in the making.
- Since the 1990s, the scholarly field of “transition studies” has sought to explain how major shifts take place within individual socio-technical systems (e.g. the energy or mobility system) and how governments and other actors may stimulate such shifts and steer them in (societally) desirable directions.
- More recently, historian Johan Schot introduced the notion of Deep Transitions to describe the overarching changes that our world has undergone since the late 18th He defines these as “a series of connected and sustained fundamental transformations, of a wide range of socio-technical systems in a similar direction”. Over the last two and a half centuries, subsequent technological revolutions were uniformly headed for industrial modernity (i.e. mass-mechanization, rising labor productivity, intensive use of energy and natural resources and the globalization of value chains).
- According to Schot and his co-authors, a Second Deep Transition may be necessary to solve the structural problems caused by the first. That is, a truly sustainable and inclusive economy can only be realized through a radical and fundamental overhaul of the economic and societal “rules” that have emerged over the course of the First Deep Transition. While still in its early days, the first signs of this process are already visible in the transitions that are taking place in individual systems of, for instance, (renewable) energy and (smart and sustainable) mobility.
Connecting the dots
The basic tenet of the Deep Transition framework is that seemingly separate historical technological revolutions can share a single directionality. Looking back, we have seen waves of change that may have looked different (i.e. driven by distinct General Purpose Technologies such as steam engines, electricity and IT), but in reality, they shared an underlying principle of a “relentless emphasis on productivity growth”. In the process, persistent societal problems like air pollution, climate change and social inequality emerged and these are now deeply entrenched in current modes of (mass) production, distribution and consumption.
Persistent societal problems like air pollution, climate change and social inequality emerged and these are now deeply entrenched in current modes of (mass) production, distribution and consumption.
To solve these problems, the authors argue, change is needed on a similar scale and with a similar depth. More precisely, instead of “mass-production for global markets” we need “socially useful and craft-based production for local markets”, today’s “linear resource-intensive economy based on the use of fossil fuels” must give way to a “circular waste-free economy based on the use of organic materials” and instead of individual modes of consumption we need more collective forms of consumption.
In the current stage of development, many of today’s efforts to realize these grand ambitions are still organized on the level of individual systems; renewable electricity in the energy system, the rise of meat-alternatives or local sharing platforms for household items. These system-level transitions are worthwhile in their own right, but in order to truly make a difference they cannot (and will not) remain isolated from each other. While they are already driven by a shared set of factors (e.g. societal or political pressure), they will also add to an overarching set of (written and unwritten) economic and societal meta-rules (e.g. the circular economy). Such new rules are necessary, since the existing rule-set is geared towards the very technologies and solutions that created the problems in the first place. These old rules thus block the widespread adoption of technologies, business models and forms of consumption that may solve the problems of the first Deep Transition.
Whether or the next Deep Transition will indeed pan out along these (societally desirable) lines remains to be seen, the authors acknowledge. They point out that there is always competition between diverging solutions or (meta-)rules and their proponents (e.g. states or businesses). This is true for system-level transition as well as for a Deep Transition in its entirety. For one, exogeneous events or shocks like wars or natural disasters may very well change the course of a Deep Transition. WWII, for instance, provided a massive stimulus for the industrial modernization of Europe. Looking ahead, a major climate-related catastrophe could provide a similar stimulus for a full-on green revolution. We can, however, not rule out that a new global conflict could impede efforts towards equality and sustainability in favor of short-term thinking along the lines of the old, problematic, rule-set
- There’s clearly momentum for several system-level transitions towards sustainability and equality. Whether or not these will result in a radical overhaul of the economic and societal rule-set is questionable. It seems that many of today’s solutions actually perform quite well within the existing framework (e.g. renewable electricity reaching price parity with fossil-based electricity).
- Carlota Perez has argued that the current “greening of capitalism” is part and parcel of the IT revolution. In other words, IT, as a General Purpose Technology, enables the roll-out of smart grids and also underpins other forms of green technology. Others claim that these green technologies themselves are at the root of the next Perez’ian technological revolution. The latter implies that these technologies are currently in their first phase of development (installation) and that a green-tech bubble is ahead of us