Comments on 'Fully Grown'
You might remember a post I wrote in 2016, No Great Technological Stagnation where I argued various things that are worth repeating and valid today: Technology is not the same as productivity growth, and there is no great stagnation in technology; rather there are localized slowdowns, accelerations, and stagnations1, and of course TFP is more than technology. Also last year I wrote on whether WWII was good for growth, and I linked to some evidence that the rate of growth of population could be behind a stagnation in productivity growth.
Back when I wrote that first post, Dietz Vollrath wrote a reply to my blogpost (See also this comment) where he was already putting out there the idea that how productive the various sectors of the economy are, and how large they are within the economy, matter to explain the observed patterns of economic growth.
From way earlier there was also this from Noah Smith, that shows that the TFP stagnation of the 70s is actually an stagnation of 'nondurables' (Where services are).
This all put together it won't come as a surprise that I've liked the book and I find the explanation plausible. One could possibly criticise some particular numbers (e.g. the Piketty-Saez-Zucman data) and assumptions, but overall the thesis of the book makes sense (See this from Matt Clancy for a summary).
With this said, there are various points that I wanted to raise after my reading of the book:
One is that there are some obvious solutions to the "more human capital" side of things: More research into aging will help delay or even reverse it; at first success looks like extended life expectancy, with the drag of a increased elderly population but perhaps in the future that won't be the case. There could also be a case for pro-natalist policies, but as Vollrath mentions, that could take decades to take effect, and even then it would have to be something more drastic than anything that has been tried in any country so far. I also expect someone else in some other review to bring up the argument that actually, there is no preference for families as small as the ones observed today, and thus them being that small is not a sign of progress.
Another point is that the correlation between areas with more housing regulation and high productivity may have a statistical explanation: If a place is made expensive to live, only highly productive (And thus well paid) workers could even live there. There are anecdotic reports of artists having left SF, having become unaffordable. This doesn't play any role in the argument of the book, but it's worth mentioning.
Although the book's title is 'Fully Grown', even after the author's caveats that a focus on the distributional aspect of the GDP is still important, I think countries at the growth frontier are far from fully grown: Services are insufficiently automated; education or healthcare2. It is true that the future looks like little work and lots of fun, but we are far from there. Not that the author endorses complacency; instead the book's point is that once this is all done then it's a one-off boost to GDP, but that's it. As more of the good stuff is better than less of it, those additional improvements are worth pursuing; at worst we'll get that juicy step jump in GDP and at best we might get actually more growth.
The point of focusing on technology directly rather than economic metrics is that it is easier to measure (Though one has to pay the price of making comparisons between technologies harder), and it allows for a fine-grained assessment field by field, informed by relevant physical principles and knowledge of the fields in question; which in turn helps thinking about what fields are advancing slower than one might expect them to. An example of this sort of analysis is my piece on skyscraper construction speeds. 2: Wait until someone publishes 'The Case Against Healthcare'. Some notes on that in my review of The Elephant in the Brain and of course the book itself.