History is an important topic because it gives you perspective. It helps you understand why things are the way they are. It gives you a better understanding of yourself. It helps you see trends that can better assess the future.
Venkat Rao wrote a truly amazing 7,000 word thesis on the past, present, and future of the corporation and the value that they brought. He combines views in Macroeconomics to politics and history to show how the corporation has influenced the world, and what the value they should bring in the future is.
Without realizing it, the hundreds of entrepreneurs, startup-studios and incubators, 4-hour-work-weekers and lifestyle designers around the world, experimenting with novel business structures and the attention mining technologies of social media, are collectively triggering the age of Coasean growth.
Coasean growth is not measured in terms of national GDP growth. That’s a Smithian/Mercantilist measure of growth.
It is also not measured in terms of 8% returns on the global stock market. That is a Schumpeterian growth measure. For that model of growth to continue would be a case of civilizational cancer (“growth for the sake of growth is the ideology of the cancer cell” as Edward Abbey put it).
Coasean growth is fundamentally not measured in aggregate terms at all. It is measured in individual terms. An individual’s income and productivity may both actually decline, with net growth in a Coasean sense.
Ronald Coase is best known for his work on The Nature of the Firm, and looking over his concepts, you quickly realize this framework helps answer the employment and growth questions that people have been asking for decades.
As I’ve written before, “How do we grow?” is the wrong question to start with. The right question, as posed by Rao, is “How shall we measure growth in this century?”