Whether you agree or disagree with him, Cowen is always worth a read. He's widely read, eclectic in taste, and although a libertarian conservative, he has an admirable willingness to at least listen to opposing points of view (he doesn't always refrain from strawmanning, but more on that later). This is his followup to his 2011 conversation-starter The Great Stagnation, and it's both a look at the trends that will drive America's emergence from our current period of economic malaise and an engagement with technology writers like Erik Brynjolfsson and Andrew McAfee, whose Race Against the Machine is the single greatest influence. I don't disagree with much of his basic analysis about trends in automation, but I have major problems with his analysis of the political shifts in response to those trends, as well as his attitude towards those shifts. Much of the beginning of the book can be thought of as the outlines for a sci-fi short story set in the year 2035, while the end resembles a Wall Street Journal op-ed set in that future dystopia.

Cowen's main guide for thinking through how automation will transform America's economy (and to a lesser extent, the world's), is Freestyle chess, where teams of a few humans guide one or several chess engines through games, competing against other teams of humans and computers. While the famous Deep Blue v. Kasparov match seemingly proved once and for all that computers were "superior" at chess, it turns out that the combination of human intuition and judgment, backed by the powerful number-crunching abilities of modern engines, is even better. Cowen used to be a champion chess player, so he's understandably excited about what the introduction of unprecedented analytic abilities means for the game; instead of seeing computers as a threat, he sees them as an opportunity to take the game to levels undreamed of a few decades ago. Humans and machines, working in harmony to push the chess production possibility frontier outwards.

To be uncharitable, when all you have is a chess metaphor, every problem looks like a rook. Cowen mentions several other fields where automation could be transformative. Online dating is one - I know several people who have met and married through online dating sites, and as those sites continue to crunch more numbers and improve their ability to find compatible matches, it's reasonable to think that they could someday become as indispensable to the future romantic market as things like church socials or fraternity/sorority mixers used to be. Automation can help people "solve" the problem of romance, because in the end it's still up to people to decide how far they want to use whatever suggestion the computer spits out. That computers don't necessarily do a perfect job isn't that big of a deal; after all, people have to dodge the advice of "helpful" relatives trying to get their still-single cousins hooked up all the time today. The benefits of automation sound reasonable, possibly even desirable, and it's easy to think of plenty of other areas of human activity that can be and are being transformed by Big Data. Cowen is much less radical than hardcore techno-enthusiasts like Ray Kurzweil, calling Singularity visions "religion for computer nerds", which seems fair. However, there are a number of areas where his analysis falls flat, particularly with regard to the macro implications of this trend.

It's become apparent in the past few years that the US has seen a sort of hollowing-out of employment opportunities: both low-wage and high-wage jobs are doing more or less fine, but middle-wage jobs like factory work are disappearing or stagnating. This could be for many reasons, but a corollary of the idea that automation is the main culprit behind the loss of middle-wage jobs (granting this for the sake of argument) is that the returns to the people who assist in automation by designing, maintaining, or utilizing it should be going up. This is certainly true; tech centers like Silicon Valley are some of the richest places on the planet. Some of the implications of this transformation that Cowen wants to draw seem true, for example the gender effects of what qualities will be most sought-after in new employers:

"The growing value of conscientiousness in the workplace helps women do better than men at work and in colleges and universities. At my daughter's recent college graduation ceremony the awards for the top achievers in all of the school's programs and departments went almost entirely to women, including awards in science and mathematics.
It is well known from personality psychology, and confirmed by experience, that women are on average more conscientious than men. They are more likely to follow instructions and orders with exactness and without resentment. That means better jobs and higher wages for a lot of women in this new world of work, without a comparable upgrade for a lot of the men. There is plenty of evidence that women are less interested in direct workplace competition and more likely to work well in teams and more likely to seek work in teams. You can think of men as the "higher variance" performers at work. That means some men are more likely to be the very highest earners and also to exhibit extreme dedication to the task, perhaps to the point of being monomaniacal. At the very top there will be a disproportionate share of men as CEOs, top chefs, and also chess players, among many other avocations. Other men, in greater numbers, will be more irresponsible, more likely to show up drunk, more likely to end up in prison, and more likely to become irreparably unemployable."

Indeed, in the tech industry, despite the fact that women are often less prevalent and more likely to favor different types of jobs within companies, within each job type the male-female salary gap has all but disappeared. Companies in many cases can't afford to discriminate against perfectly capable workers, and new social norms are evolving to keep up with the shift. It's certainly possible that that same situation prevails in many other fields as well. However, median wages as a whole economy-wide are nonetheless flat, and this trend began in the 1970s, long before IT was a common or even an uncommon profession. While we may perhaps be entering the "second half of the chessboard", in Brynjolfsson/McAfee's phrase for where the effects of automation are increasing quickly, Cowen is far too dismissive of political causes for widening inequality, as shown in, for example, Jacob Hacker's Winner-Take-All Politics. Completely absent is any hint that an entire literature on the sources of inequality in contemporary conservative political movements exists; to Cowen, robots are much more interesting to talk about.

This same tendency shows up in his discussion of the future of education. Cowen is a big fan of Massively Open Online Courses (and indeed runs one himself, which he admirably does not plug for here). MOOCs are cheap, flexible, profitable, and easy to measure, so he allows himself to rhapsodize about their impact while grumbling about educational bureaucracies standing in their way for all sorts of base reasons. I'm always interested in why many older people, who had the benefit of being educated in the pre-stagnation era where college was cheap, credentialization was low, and a bachelor's degree from a state college was perfectly sufficient for the majority of jobs, are actively cheering for the destruction of that kind of environment. What until very recently seemed like adequate educational systems (e.g. the three-tier California higher ed system, the University of Virginia's traditional focus, the established tenure process) seems to no longer deliver value to students, and rather than attempt to roll back some of the destructive trends of tuition inflation, the spread of parasitic administrators, or new fads in corporatizing the process of learning, people like Cowen actually want to speed them up. Cowen himself went to a public university (George Mason, where he now teaches) and seems to be none the worse for it; why exactly do we need to upend everything about universities as they've been known for decades if not centuries in favor of replacing real professors with poorly-paid adjuncts and classrooms with iPad labs? I get that automation is something that should be embraced and not blindly fought, but he's awfully eager to throw a lot of professors out of a job without a lot of thought as to the merit of opposing arguments.

There are two science fiction stories that really should have been mentioned in his ending. The first is Neal Stephenson's The Diamond Age, which directly bears on his suggestion that "Neo-Victorian social ideals" should be more prominent in the educational process (though, interestingly, the schools in that book resemble nothing so much as classical academies with the quadrivium and everything, with nary an iPad in sight). Once we've gotten used to the idea that economic change will reward high-skill individuals while not doing much for middle- or low-skill peons, what happens? Cowen thinks politics will look much more like Florida, with a critical mass of extremely reactionary old people fighting further redistribution false tooth and nail, while economically we'll resemble my native Texas, with a few bright spots of high-tech and high earners amid large swaths of bland, almost Latin American poverty. He literally advises the losers to suck it up and get used to cheap diets (let them eat beans?) and lifestyles reminiscent of the proletarian thetes in Stephenson's novel, while hilariously strawmanning liberals who want to alleviate or avoid this two-tier society:

"A lot of commentators, most of all from the progressive Left, object strenuously to rising wealth and income inequality. Even if they are correct in their moral stance, they too quickly conclude that rising inequality has to cause other bad results, such as revolution, expropriation, or a breakdown in social order. That does not follow, and I sometimes wonder if it isn't an internal psychological mechanism operating in some of these commentators, almost as if they were wishing for the wealthy to be punished for their sins."

My not-so-polite reaction to this unsourced tirade aside, it's fascinating to see an obviously bright guy try to head off his ideological opponents at the pass by resorting to cheap "some people say..." rhetorical tactics like that. He also makes the correct observation that many of the parts of the country that have been hit hardest by inequality are also the most conservative, but while the Republican Party might be able to ride its control of many of those areas to a majority of the House for a while yet, he doesn't engage with the broader demographic trends which indicate that young people are far more liberal, both socially and economically, as the traditional division goes, than the elderly, and far more receptive to measures that benefit them by decreasing inequality. Much of politics can be explained by the simple theory that old people want to hang to their nice things while not giving any nice things to younger generations - just look at cries of "Keep your government hands off my Medicare" by the exact same people fanatically opposed to Obamacare. This point of view is unengaged with, to put it mildly. Additionally, Cowen seems weirdly uninterested in broader possibilities in his analysis of the effects of inequality within the elite, not just between the elite and everyone else:

"If you think about it, we really shouldn't expect rising income and wealth inequality to lead to revolution and revolt. That is for a very simple psychological reason: Most envy is local. At least in the United States, most economic resentment is not directed toward billionaires or high-roller financiers - not even corrupt ones. It's directed at the guy down the hall who got a bigger raise. It’s directed at the husband of your wife's sister, because he earns 20 percent more than you do. It's directed at the people you went to high school with. And that's why a lot of people aren’t so bothered by income or wealth inequality at the macro level: Most of us don’t compare ourselves to billionaires."

Many of the new elite, including the majority of tech zillionaires, are famously liberal. I certainly expect rich people to be more economically conservative, ceteris paribus, than non-rich, but the kinds of people who will be the decision-makers in the future won't necessarily resemble the decision-makers of the past, and indeed might have a lot of the same resentment towards Koch brother-types that Cowen diagnoses the rest of us as having. It's far from unprecedented for the political system to ignore large swathes of the country, so it's entirely possible for big chunks of the electorate to become even more extreme at their place in a changing world (call them the Eye Tea Party?) while the rest of the political system figures out a way to move along regardless. Allow me to point out that the Mercatus Center that Cowen works at has gotten a lot of Koch brother money and leave it at that.

Speaking of decision-makers, the second sci-fi story which should have been mentioned is Isaac Asimov's The Evitable Conflict, the final story in I, Robot. In it, it's discovered that the benevolent computers which help manage the world economy have been deliberately marginalizing criticism of their work from anti-robot activists through subtle economic economic sabotage. They've circumvented the Three Laws by rationalizing that they can best help humans by continuing to stay in power, so causing small harm to a few specific humans by making their jobs redundant or causing them to be reassigned is an acceptable bending of the rules. The affected individuals get tolerable replacement jobs, and humanity continues to enjoy the benefit of the robots, so it's win-win,really. Since this isn't a book about AI, the idea that automation on its own could impact human quality of life in that way isn't really relevant; the most likely consequence of this hyper-automation trend is simply that the people who run the world economy will have such specialized and arcane knowledge that they'll effectively be beyond criticism or reproof from voters. Also speaking of voting, Cowen does mention another Asimov story:

"We will start to see just how well some of these machines can predict our behavior. One of Isaac Asimov's most profound works is his neglected short story Franchise. In this tale democratic elections have become nearly obsolete. Intelligent machines absorb most of the current information about economic and political conditions and estimate which candidate is going to win. (In fact a small number of variables, such as the change in GDP, the unemployment rate, the inflation rate, and the presence of a major war, predict presidential elections pretty well.) In the story, however, the machines can't quite do the job on their own, as there are some ineffable social influences the machines cannot measure and evaluate. The American government thus picks out one "typical" person from the electorate and asks him or her some questions about moods. The answers, combined with the initial computer diagnosis, suffice to settle the election. No one needs to actually vote."

It goes without saying that Asimov did not necessarily intend the story to be utopian, and that one need not accept Cowen's prognostications of what automation will do to our ability to have a political system that resists the Gilded Age/Latin American-style dysfunction he envisions. This book contains a lot of thought-provoking insight about some areas where the IT revolution could have a profound impact, particularly for people who already work in Big Data-ish fields; however I can't recommend his political conclusions at all. ( )

Excellent summary of how technology is changing employment, and how that will affect all of us.
I especially liked the discussion of Freestyle chess, which is becoming the example of how we will live in a future world when computers can do most things better than people can. Just as humans have adapted to unbeatable chess programs, by cleverly playing them off one another, we'll adapt in other fields too. ( )

I heard the chap on NPR this morning talking as if "income inequality" were some sort of physical law utterly unrelated to social policy. I'd call him an idiot, but I think it's clear that he's pushing a particular flavor of economic theory that suits his department's funders, the Koch brothers.

A view on the continuing bifurcation of society into groups of "those who can" and, well, everyone else. The author is a bit too fond of chess, as he uses it in many of his arguments. The changes that have occurred in chess resulting from advances in computing and players adapting to new methods of study and learning using computers do illustrate his point nicely though. I just don't think chess is a good analogy for "everything." I was hoping for more "ah-ha" moments. Point taken, not all that interesting. ( )

Very Interesting topic and Cowen makes many strong points. But, the same points could have been made in a book half as long. ( )

Average Is Over: Powering America Beyond the Age of the Great Stagnation is supposed to be a longer sort of sequel to his Great Stagnation (my review).
Tyler Cowen forsees a future with a continually widening gap between the top 1% and the bottom 10%, but without the guillatines and other doom predicted by modern Progressives. He believes our society will grow more conservative as the elderly make an increasing percentage of the population and will accept the new norm and what comes with it. Competition with China will settle the country to accept other status quos much as competition with the USSR did in the U.S., Cowen predicts.

The "winners" in the coming economy are those who can effectively use machines-- not necessarily programmers but those with enough skill to use the data that machines can give us, while making the machines do what we want.

"Overall, these job market trends are bringing higher pay for bosses, more focus on morale in the workplace, greater demands for conscientious and obedient workers, greater inequality at the top, big gains for the cognitive elite, a lot of freelancing in the services sector, and some tough scrambles for workers without a lot of skills. Those are essential characteristics of the coming American labor markets."


The "losers" will be those who do not adapt, they will continue to see decreases in their real wages but some will get along fine, enjoying what would once have been considered marvellous luxuries-- cheap high-speed internet and cellphone service, education, food, and clothing. Others will not fare so well, and will create problems for society much as one sees today.

As higher taxes are an inevitability to pay for the greater debts the government is projected to run due to entitlements like Medicare, people will continue to move to places like Texas where they will settle for "C-level" local government but enjoy cheaper housing, helping their paychecks go further.

Cowen's chapters on and frequent references to the evolution of technology in chess play are a bit of a digression, these made the book rather boring. Also, is it not obvious that those who can effectively use technology today are the ones who have an easier time finding jobs? Isn't the future he's predicting already here? Perhaps he's just staying it will stay the way it is, more of the same. In some cases, a technology-oriented future needs more people, but they all need to be more highly skilled as well.

"Keeping an unmanned Predator drone in the air for twenty-four hours requires about 168 workers laboring in the background. A larger drone, such as the Global Hawk surveillance drone, needs about 300 people...an F-16 fighter aircraft requires fewer than 100 people for a single mission."



He considers his take different because it doesn't predict much of the gloom-and-doom but more acceptance of the status quo.

"Right now the biggest medium for envy in the United States is probably Facebook, not the yachting marinas or the rather popular television shows about the lifestyles of the rich and famous."


The book does not touch foreign policy much at all. Cowen admits that many of the middle-class, low-technology jobs have gone to China, and argues that allowing more immigrants would help bring those jobs back-- and thus create jobs for more native-born Americans in creating the infrastructure for those companies. That would also help ease the funding burden for programs like Social Security by having a larger number of workers paying in.

The military's huge component in our economy is not properly dealt with, I believe. Cowen sees somewhat of a retreat of the U.S. military from the world stage, but doesn't explain what this will mean for jobs directly or indirectly dependent on the military. That's a weakness of the book.

I did enjoy his critique of behavioral economists, how their own studies fall into the pitfalls of cognitive bias that the subjects they critique generally do.

"(Behavioral economists) are looking for behavioral theories that are too elegant, too simple, or too intuitive, such as the abstract strictures of mathematical decision theory."


Whether you like this book or not depends on whether you like the prophecies. Like any book with somewhat broad predictions, it is hard to judge. His references and beliefs are well documented, 25% of the book are references-- it's well-known that Cowen may be the most well-read person on the planet.

I give this book 3 stars out of 5. Not the best Cowen book. ( )

Tyler Cowen is a writer, blogger, and an economist. It is in the latter role that he is foremost although his influential blog, Marginal Revolution, is renowned and I would certainly recommend it. He has written five books, not counting textbooks, and his latest is Average is Over: Powering America Beyond the Age of the Great Stagnation. While the title tells you about the main theme of the book I found that, beyond the economics of our current snail-like recovery from the depths of the recession, this book is a cornucopia of ideas about a diverse number of aspects of our life both now and in the future.

There are three Parts to the book which focus on first, the growing divide between those who earn more, much more than average and those who are below-average earners; second, the importance of machines and, in particular, games in our future; and third, the changing nature of work.
The opening chapters establish some of the important themes for the book by describing the current environment of stagnation and making the claim, that will be supported by examples throughout the book, that "new technologies already emerging will lead us out of" the current stagnant economy. In fact the economy is not stagnant for everyone, for those who have already adapted and are involved in the "right" sectors of science, technology, engineering, and math (STEM), in particular the growth in computers, the internet, and most importantly intelligent machines. Cowen also introduces the metaphor of Chess that returns again and again throughout the book. You do not need to be an expert in the game to understand the power of intelligent machines that can 'crunch' the data necessary to defeat grandmasters every, every time they are challenged.

"As intelligent analysis machines become more powerful and more commonplace, the most obvious and direct beneficiaries will be the humans who are adept at working with computers and with related devices for communication and information processing. If a laborer can augment the value of a major tech improvement by even a small bit, she will likely earn well. (p 21)
He supports this with examples from areas like the growth of cell phones in both quantity and quality, the changes brought about by super-computers that play chess and for several years have been significantly better than the best grandmasters, and the changing nature of work with examples from companies at the forefront of the new age like Google and Amazon. The tests given prospective employees at Google are described and they seem like something out of a trial for Mensa. Are they easy?
"There's a whole book titled Are You Smart Enough to Work at Google? by William Poundstone. A few minutes reading it will make the answer clear to most readers, even if the word smart is not exactly the right word (Picasso was a genius but I doubt he could have landed a job at Google's Mountain View headquarters)." (p 35)
The days when you could just show up, role up your sleeves and start selling or doing any job are dwindling.

The changes discussed, documented, and commented upon in the first part of the book carry over into the latter two parts. There are and will be more changes to the nature of how you obtain a job --note the impact of social networking websites like Facebook or LinkedIn-- and your workplace whether it is an office, a factory or a sales counter. That the days of the lone scientist are over seems even more true as the complexity of machines as tools grows exponentially. Education faces changes as well due to the impact of the world of new machines. Cowen discusses the rise of MOOCS (massive online courses), information blogs, and the ubiquity of avenues for online education. But there is more.
"It is not just formal online education and blogs. Apps. TED lectures on YouTube, Twitter, reading Wikipedia, or just learning how to work and set up your iPad are all manifestations of this new world of competitive education, based on interaction with machine intelligence. These new methods of learning are all based on the principles of time-shifting (watch and listen when you want), user control, direct feedback, the construction of online communities, and the packaging of information into much smaller bits than the traditional lecture or textbook chapter." (p 181)

Late in the book Cowen discusses the potential changes for his own profession, the 'dismal science' of Economics. He anticipates that theoretical models will be challenged by more and more data-driven approaches. He says (and as someone with an Economics degree I read with interest) it will go as follows:
"(a) much better data, (b) higher standards for empirical tests, and (c) lots of growth in complex theory but not matched by a corresponding growth in impact. Mathematical economics, computational economics, complexity economics, and game theory continue to grow, as we would expect of a diverse and specialized discipline, but they are if anything losing relative ground in terms of influence. Economics is becoming less like Einstein or Euclid, and more like studying the digestive system of a starfish." (p 222)

The economics profession is like other social sciences and, like the economy as a whole, will be changing in ways that both take advantage and depend upon ever more powerful and complex computing and communication devices. There is much more in this challenging compendium of facts and ideas that will change our world. The direction of this change will determine where you and I will be and what we will do in the age of intelligent machines. In Average is Over you get one very knowledgeable economist's glimpse into that future. ( )

total waste of time. the usual: machines and the fear of China. don't recommend this book

provocative read, accessible in terms of not being jargon heavy ( )