I dont believe in long preambles but i feel that i should say a few words before i Start Talking about technology. The first thing is that i am well aware that many of you have no idea going on. So thank you for showing up out of the spirit of pure curiosity. Tim s speaks very well of you. I know those really big names. So i feel very honored to be here. So who am i. I write a column for the undercover columnist for the Financial Times. It is really good. I recommend it. Thank you sir. [laughter]. The second thing is that i do radio. Adagio for service they called 50 things that makes economy. And all about numbers and how we think about numbers and how number sometimes stray sometimes. It helps us understand the world. I also have a podcast with a gentleman called malcolm gladwell. Cautionary tales which is all about things going wrong and sometimes in tragic ways and sometimes in amusing ways. And what we can learn from them. So in between all of that, i write books. It took about what i learned i think one of them. That is one thing is anything that i wanted to say is thank you to the Rancho Mirage, and the festival and to jamie, and the rest of the festival guys. Lets give a hand it to jamie please. Thank you. Come back. So jimmy emailed me months ago and suggested that i fly across the world from england to come to Rancho Mirage and i couldve heard of palm springs, slick homes features a different breed didnt know. So the huge journey for me is only possible to fly and someone like me from a very long ways away with devoted readers and the angels and all of the people to support the best festival. So thank you very much to all of you and i feel very fortunate to be here. [applause] so is that it was not a fan of long preambles. So clearly i am a total hypocrite. Let me talk about this book of mine, fifty inventions that shaped the modern economy. I dont know whether you can see this line or not, but i can see a slide. Okay. Feel free by the way to put the camera back on me. It is just a pack shot. You can put the camera back on me. Im going to talk about the book as such. I will talk about what i learned when i was working on it. This is a project originally for the bbc. I picked 50 different images that i found interesting. Not the most important inventions not the most obvious but the inventions that i felt something to teach. There were stories behind these inventions. He blessed me, will hundred you choose them. Lunch is on because i thought they were interesting. And that is the only criteria. So what did i learn i think, feels like an important question because at this moment, we are asking Big Questions about what technology does and how it shapes our society. What coming up with a very wide range of answers. And for all of our understandable focus on politics and political debates, very often it is technology really shapes how we live and how our economy grows and how our Society Works pretty the answers to these questions ask this. We talk to economists, it really into camps. One group says look at the progress of computers. And look at the progress of Artificial Intelligence. It is really possible that after about two centuries, of people falsely wearing that the robots are going to take the job, its actually possible that they might do it this time. And people want really hard to look at the data in the history and have a very compelling case that this has happened. At the same time, theyre equally expert people and equally crisp a persuasive and compelling that will look at the data and say an employment rate is at record lows, productivity growth is extremely disappointing and we seem to be in the mill of the technological sundown. If the robots are going to take the job, will they please hurry up and do it. Because menu a few more robots around here. So theres a puzzle between these two views. Ive been studying this debate for years and i still dont know the answer. But this is the question really and illuminates a lot of debate rated so trying to understand how Technology Works and shapes our lives, i think it is not just a matter of curiosity. But of course curiosity is the most important thing. It goes beyond to the answer these questions and if they we dont know what the answers are. The answers to the questions do really matter. So i said i would tell you what i learned with you on this book i learned that we make two big mistakes when we are thinking about how Technology Works. The impact that the technology has. I wanted to talk about the mistakes because there always fun. We just owe you an image from one of my favorite movies. This is an image from blade runner. And some of you may have seen the film when it came out and they in her 80s. I was to go is pretty graphic politicking on sheet film but it still says up in a still a good film. If you look at the image that i showed you, of what appears to be a beautiful woman smoking a cigarette which by the way, hopefully youre old enough to know better. Do not do this. It looks cooler movies but do not do this. It is not a beautiful woman smoking a cigarette. This is a machine, it is a robot in the robots name is rachel and rachel is a replicant and a replicant is a kind of organic take robot that is indistinguishable from a human with a mind that is indistinguishable in the human. And rachel blames herself to be human. Spoiler alert. She think shes human and shes not. It takes a specialist played by harrison ford, a hero takes a specialist with special equipment to tell the difference between this artificial creature, this piece of technology as a human being. And it is so sublime and so seductive is rachel the man this job it is to retire rogue replicants, enemies rachel, he falls in love with her. Partly see has certain urges toward her rate is not entirely clear please see here, this is him calling her up because we do when you want to date a robot. The answer is you do what you do when you want to date anybody. You phone them up. And this being the future, is being a future of Incredible Technology where we have Artificial Intelligence in these synthetic humans indistinguishable from the real thing, deckard phoned sarah on the payphone on the wall of the bar. [laughter]. There is something wrong with this. So, because this film was made in the 1980s, and los angeles, you can see graffiti on it. It causes a video phone, not a purely audio phone but this is the phone, attached to the wall of the bar and of course she says no and hangs up. And you can see the phone of the future. By the way is set in 317. No turning 19. So this is weird divergence here. This unbelievably sophisticated technology, rachel the organic robots, and absolute lack of progress in anything else. They do have flying cars but apart from anything else that Everything Else is the same. An amazing lack of imagination about what else might change. I do want to criticize blade runner because its a great movie and the story telling him he cant change any thing there because then the audience has no frame of reference and what is going on but i do think it is revealing that you can conceive of a society when you have human level Artificial Intelligence and we have perfect flawless genetic engineering and yet if you and make a phone call, you put coins into a box on the wall of the bar. Suet is going on here. What is the basic mistake here. Sure, it is partly in his hartley it hard to see in the future. It is complicated. I think the fundamental mistake is very common it is an obsession with the most complex technology that you can envision. If the technology was not are have not made our parents gassed and say, this is magic, this is sorceries and how does it work. Then technology if it is noted that, we dont think its technology. That is a big mistake. Its incredibly sophisticated and complex and were going to prep for profoundly mistaken how it works. Let me give you an example. This is of course, the bible. And what i learned on the book is that with throughout and talk to economist to historians, to technologists, people who are scientists and i said was shot but in the book and everybody said this Printing Press. You must put it in the book. I did not with the Printing Press in the book. Some were not. Lets have a look at the Printing Press again with the bible. So this is a remarkable object and we look at these nets, these dense black columns of text which are written in latin. The illustrations are and it drawn. But there organic illustration by monks. This is made by machine no and its remarkable technology. But when i look at it, what do i see. I see paper. No one ever gets excited or excited about the paper. But the thing is, you cannot have this without paper. You can have parchment, and is made of animal skin, sheepskin, or ski calfskin. And you can print onto parchment. And they did print some of the bible onto parchment. Before he lost control of the Printing Press printed i did the math because i am a proud geek. I did the math. You want to do it print of the bible, not a huge print, maybe 2000 bibles. You need a quarter of a million sheets for sheep to make the 2000 bibles. This not going to work. So you say well, lets just print 50. We dont have to print 2000. But if youre just going to print 50, but as a point of having a Printing Press. It is easier just to hand write the things. So the economics of printing demand this paper now the history paper i find fascinating. Is my absolute favorite invention in the book. Admitted in china, a lot of things are invented in china about 2000 years ago but initially used for wrapping stuff up. And they found it comical because its cheaper consulting lighter than what anything right on it. And it arrived in the islamic world around 1300 years ago. In Islamic Culture and really striving literate culture with no printing. It was all handwritten. And then, the Technology Side of the fringes of europe. It was partly the weather thing. How do we make paper that does not go moldy and european weather. I was a solvable problem. Europeans just were not very interested. Most of us cannot read or write. In the main demand for writing on services is to make bibles. I will go into too much detail with the manufacturing process of paper, and involves yearend and stinky rigs. Its kind of a dirty process. And as the first process of making paper in europe. So you if you are proposing even to make a bible, out of stinky stinky cheap paper, thats almost offensive. Thats almost like saying, like out of a cheaper way to make a crown for the king. We could make it out of the lead instead of making it out of gold. Well yes that would be cheaper but what is the point of cutting corners to make a crown for the king. In the same thing with the bible. Its a holy object. There are very few of them in every thing is handwritten. He was a cheap bible and it is pointless. And paper only came into europe because it was a commercial culture arriving around it the italian merchants. And for letters and accounts, see the first washer driven paper mills in italy, they are still beautiful paper with a driving these in pulping these rags in the year and yes, and sounded beautiful for second but they are making paper. And kmart slowly spread through europe as an everyday commercial thing. And it arrived in what is now germany in the late 13 hundreds. And within half a century, you have this invented the Printing Press and there is absolutely no point in massproducing writing until you can massproduce a writing surface. So this is the principle of understanding technological change, it is the paper principle. Someone something to come cheap enough and want something to come cheap enough to make toilet paper out of then it is cheap enough to change the world. Paper is everywhere. We print on it, we decorate our walls with ants, receipts, towel, you go to the restaurants here, and wash her hands and you got your hands on paper review throw it away. It is completely in vicki woods have because it is cheap. Not because it is complicated, it is 2000 years old. It is cheap and is still important. My argument is that one of the things that we miss about technological change weve missed the cheap stuff, keep simple stuff changes the world. In short i am completely excited about computers and are interesting. But give me cheap stuff and i will show you the stuff that is really going to make a contribution while being widely overlooked. If you a couple of other examples. Heres the first picture, thus are not very nice sentiments. This is not a picture of what you think it is. This is not the clan, these guys are cutting barbed wire. They do not wish to be seen cutting barbed wire. Barbed wire, will thats intriguing. Come from. Only 1860s, and i want to come here your you on american history. I do want to apologize in advance for doing so. But abraham taken is trying to shift the central gravity away from the south and towards the midwest and the west. Move the sins of the American Economy and shifted away. You just show up, in the midwest and for some fence around sunland, and there were some people who were there first. Org about them. Some fence around the land. Confirm that land for five years and then it is yours. Its the homesteading act. And there is a problem is not enough wood. You need the wood for firewood and building and you cannot beat building fences out of wood. It is far too expensive. So just put up ordinary wire but the long arm cattle will go right through. They will destroy crops. So heres an interesting lesson. We talk a lot about Property Rights and the importance of it in economics. It is super important. But there are Property Rights that you have legally, and pricing of practically. Because you actually have the ability to enforce this Property Rights. So longhorn cattle are not paying attention to president lincoln. They will come and destroy crops. So this is an example in admin invention for barbed wire. Everybody knew was necessary. They just did not know how to do it. Some inventions like the laser, people created this and wonder what we can do this. But barbed wire we knew we needed barbed wire. In two thirds of all of that applications, the fencing, or coming out of the midwest. Globally, for fencing were coming out of the midwest for a few years and then a gentleman called jay linden from illinois, also where Cindy Crawford is from. He did not get the patent for what is recognizably barbed wire. You still recognize it today. Industry wire, yet sharp bits wrapped around it. They have another string of wire you twist one and interest around each other and that starts at backwards and forwards. In ten years after he got the patents, usmade 240,000 miles of barbed wire. The two around the world sometimes because of solving a problem for people. It is fencing. We had fencing beforehand an and the great wall of china, we knew how to build a wall very long time ago but this is a way to do it cheaply and again, the cheapness of it, that changed the world. Heres another example. This is from the Financial Times test is given the role. This is the price of solar power and i apologize because this graph is now four years old. Cento, we live in the desert. Thank you have solar. We still struggle to imagine what solar power would work but it comes from nowhere. Really really fast. To the extent now that nevada casinos are willing to pay millions of dollars yearly to not have to purchase power on the agreements that they have signed with you till knees. Is not that is just cheap, is that i will pay millions of dollars not to have to buy the fuel our proposal because i can just going into the electric grid. Strictness. There must be some supercool technological breakthrough. No just learning by doing. This fact that i should just learning by doing. More practice, more specialized tools. More attention to how do we practice this stuff effectively. More attention to how do we install it. Used to take a crew of four people a couple of days and now it is two or three people it takes a couple of hours. This is the technology that gave us ikea furniture. Applied to solar panels. And actually it is a very old idea that learning by doing. Originally identified in the aerospace and did this industry. 1930s, the second plane is 20 percent cheaper than the first line in the next two planes are 20 percent cheaper than the second plane in the next four plays, are 20 cents cheaper than the third the everything the, or outputs the price falls by about 20 percent. Some academics just down the road for me have studied the learning by doing effect they found absolutely that any parts, the percentag percentage there s everything from factories to bear. And exhibit needs learning by doing and the thing about solar power is that when i look to this, 99 percent of all of solar power cells ever made, have been made between 2010 and 2016. There was no Solar Industry before 2010 effectively and this sudden granting of the continuous. Gorgeous learning to do it cheaply because practice makes perfect. The same thing by the way is to above batteries. This is a completely transformative track technology and nothing special technology are complex. To get cheaper and people want morning is to forget the people or and it gets cheaper again. My favorite example and this is one for ththe shipping containe. It has done more to lower trade cars for global debbie tio, nafta, a trade agreement im an economist, we like trade agreem. Wed like dealing with foreigners and getting to sell them stuff and getting them to buy stuff and we economist were in favor of that. But think we exaggerate the importance of the trade deal. Very often this is driven by changes in technology. This telephone, the internet, the barcode. Dont get me started on the barcode printed someone find me afterwards and i will tell you but the barcode, and amazing. And the shipping container. And when you think about it, this technology was really introduced in the late 1950s. This is 1850s technologies. It is a steel box. It is corrugated to make a stronger. How complicated is that. We spent a lot of time taking stuff and putting it on a truck and the trucks that a portion of a ticket off of the truck and then reloaded and shipped in the