The Abundance of Scarcity — Reflections by Paul Saffo

There is not enough stuff in the world.  At least the kind of stuff people need for a decent life.  That was the story that kicked off modern economics in the late 1800s, which was built on the foundation of the scarcity of things that provide material wellbeing.

Stanford’s Paul Saffo suggests that what is scarce has changed since the founding of modern economics, and “Every new abundance creates an adjacent scarcity.“  Saffo suggests that in the past hundred plus years, we have shifted from (1) an industrial economy in the late 1800s that addressed a scarcity of stuff to (2) a consumer economy in the 1950s that addressed a scarcity of desire to (3) a creator economy in the late 1900s that is addressing a scarcity of attention.

1. The Industrial/Producer Economy. At the beginning of the 20th century, the leading scarcity was stuff, and so manufacture was systematized. By 1914 one of Ford’s workers could buy a Model T car with four month’s salary. Production efficiency won the Second World War for the allies. In 1944 the US was producing 8 aircraft carriers a month, a plane every five minutes, and 50 merchant ships a day. The process became so efficient that its success ended the dominance of that economy. That always happens. “Every new abundance creates an adjacent scarcity.“

2. The Consumer Economy. The new scarcity was desire. 1958 brought the first credit card. The CEOs of leading companies shifted from heads of production to heads of marketing. Container ships doubled global trade.

3. The Creator Economy. In 1971 Herbert Simon predicted, “A wealth of information creates a poverty of attention and a need to allocate that attention efficiently.” The new scarcity turned out to be engagement. The mass media television channels that had dominated the Consumer Economy were overwhelmed by personal media–YouTube, eBay, Facebook, Wikipedia, Twitter, Google, Etsy. Hollywood was overwhelmed by video games. (The blockbuster movie “Avatar“ opened in 2009 with a $73 million weekend. The previous month, the game “Call of Duty: Modern Warfare 2” sold $310 million in 24 hours.)  Mass participation became the new normal. Stuff is cheap; status comes from creation.

If, as Saffo suggests, we are now far into the age of the creator economy, what does this abundance of engagement create as the new adjacent scarcity?  Might it be the scarcity of choice in the vibrancy you experience in the five primary relationships (self, other, group, nature, spirit)?  Might it be the scarcity of the experience of being engaged (see the 2013 Gallup poll showing most of the world is disengaged at work)?

If the new scarcity is changing, we might also need to change the foundations of the agreements underlying the economy.  What do you see?

[Click here to see Paul Saffo’s 88-minute talk at the Long Now Foundation.]

One thought on “The Abundance of Scarcity — Reflections by Paul Saffo

  1. Pingback: Seeing “What Is” — The Economics of Abundance « Jim Ritchie-Dunham

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.