How the last two centuries led to today’s economy | Adam Davidson | Big Think

How the last two centuries led to today’s economy Watch the newest video from Big Think: https://bigth.ink/NewVideo Join Big Think Edge for exclusive videos: https://bigth.ink/Edge ---------------------------------------------------------------------------------- Adam Davidson, co-founder of NPR's Planet Money, can trace a line through time from homemade clothing and baked goods to today's passion economy. Davidson argues that a combination of the nineteenth and twentieth centuries are how we got to where we are. We shifted from an intimate and localized economy of goods and services, to an economy of scale, and finally to what Davidson refers to as ""intimacy at scale."" There are, of course, positive attributes to this hybrid economic system, but it also comes with some of the flaws of its predecessors. ---------------------------------------------------------------------------------- ADAM DAVIDSON: ADAM DAVIDSON is the cofounder of NPR's Planet Money podcast and a staff writer at The New Yorker, where he covers economics and business. Previously he was an economics writer for The New York Times Magazine. He has won many of journalism's most prestigious awards, including a Peabody for his coverage of the financial crisis. His latest book The Passion Economy: The New Rules for Thriving in the Twenty-First Century https://amzn.to/2X31pv5 ---------------------------------------------------------------------------------- TRANSCRIPT: ADAM DAVIDSON: I had this thought as I wrote the book that the best of the twenty-first century combines the best of the nineteenth and the best of the twentieth. And then my joke is the worst, combines the worst of those two centuries as well. What I mean by that is if you look at the nineteenth century and pretty much all human history before business was conducted almost entirely locally. You almost all physically made goods. They were made by someone who you didn't just know them your whole life, your great grandparents knew their great grandparents. And in many cases your clothes, your bed, your house were made by you or your family. And to the extent that there were services the equivalent of lawyers and accountants and doctors. Those would also have been produced locally. There's always been long distance trade but that was really just a very small number of luxury goods that had very little impact on the material lives of everyday people. So you had profound intimacy to the point where if you lived in a certain neighborhood in Brooklyn or a certain village in France, the beer, the bread, the cheese—everything was how we do it here. It was fully intimate. And you go two villages over and they do it some other way that's totally different. And so you had this incredible enmeshment between producers and consumers. Then you have the twentieth century which is about people in one place producing goods for people all over the world. So you have massive manufacturers in Atlanta or New Jersey or Chicago who are producing soda and candy bars and eventually furniture and cars and all of these goods. And they're made in one place, made in huge volume and then shipped everywhere in the world. And just the nature of that kind of transaction is scale. You can't know all that much about who's buying Coca Cola in some village in Vietnam or what things about a Ford car people in South Carolina like better than people in Alabama do or whatever. You just make, you know, with some variation you make the same set of products and ship them everywhere. And so that's scale and scale brings a lot of benefits that small intimacy doesn't. The benefit is an economy of scale. You can make more stuff more cheaply, spread it to more places. But now that doesn't work very well. Big scale is in crisis. You look at the big scale consumer goods companies like Proctor & Gamble or Unilever and they're really struggling for growth. They're struggling to basically everyone who wants Tide soap and Oreo cookies already has Tide soap and Oreo cookies. And you sort of go by a candy aisle and you see the problem. Sure, we can have M&M's with pretzels and M&M's with caramel and M&M's with peanuts and M&M's with a million other things but you're not really transforming the experience of eating candy. And we live in a world where people are probably eating as much candy as you want. So you have these companies fighting over market share sort of unable to create really transformative value. But then you have intimate products. You have products like let's use chocolate... Read the full transcript at https://ift.tt/2KHRweV