Podcast Notes: Interview with Marc Andreessen on a bifurcated economy
- The economy is bifurcated between (1) sectors that are significantly impacted by technology and (2) sectors that are minimally impacted by technology.
- The degree of tech impact in a sector is highly correlated with pricing and productivity. Prices drop and productivity increases as technology continues to improve. In these sectors, society is concerned about job transfer (perceived as job loss).
- Sectors with significant tech innovation and decrease in prices: media, electronics, retail, financial management.
- Tech stagnation and increase in prices: healthcare, education, real estate/construction. In these sectors, society is concerned about rising prices but not about job transfer.
- If things don’t change, sees a world where TVs cost $10 but higher education costs $500,000. In such a world, everyone is employed by the least technologically advanced sectors — hence, these sectors grow as both percent of GDP and percent of employment.
- My take: Listened to this Exponent podcast yesterday, which highlights the importance of understanding why users actually use a product. It is worthwhile to consider what value education actually provides to the end user. The value is not derived from learning specific things (e.g. Calculus that you’ll likely never re-use in the course of your career). Education provides (1) personal economic prosperity and, to a lesser extent, (2) community. That’s why the current iteration of online courses struggle to make an impact. The opportunity may be in looking beyond the mechanics of education to the actual value that education provides long-term, and solving for that.