speed does not depend on one area of technology or another. It is based on the observation that technology and science coevolve in a symbiotic manner by giving scientific researchers vastly more powerful tools to work with. Some of those tools have been known in more primitive form for centuries; others are radical innovations that have no clear-cut precursors.
Much as the new instruments and tools of the 17th century rang in the scientific revolution and the age of steam and electricity, the high-poweredcomputers, lasers, and many other tools of our age will lead
International Monetary Fund. Communications Department
This paper focuses on smart policies that can alleviate the short-term pain of technological disruption and pave the way for long-term gain. As computing power improves dramatically and more and more people around the world participate in the digital economy, care should be taken about how to devise policies that will allow us to fully exploit the digital revolution’s benefits while minimizing job dislocation. Digital technology will spread further, and efforts to ignore it or legislate against it will likely fail. Even with short-term dislocations, reorganizing the economy around revolutionary technologies generates huge long-term benefits. The digital revolution should be accepted and improved rather than ignored and repressed. Given the global reach of digital technology, and the risk of a race to the bottom, there is a need for policy cooperation like that of global financial markets and sea and air traffic. The history of earlier general-purpose technologies demonstrates that even with short-term dislocations, reorganizing the economy around revolutionary technologies generates huge long-term benefits.