Book Club: Brian Arthur's "The Second Economy"

The Second Economy by W. Brian Arthur is the context for a though- provoking discussion of the emerging digital infrastructure for our world.

Book Club: Brian Arthur’s “The Second Economy”

Call-in Book Review Recorded on Wednesday December 14, 2011 Anne Rozinat of Fluxicon and Sean Murphy of SKMurphy discuss the impact of the pervasive digitization of business processes on cloud business models.

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The Second Economy by W. Brian Arthur

This McKinsey Quarterly article provides the context for a thought provoking discussion of the emerging digital infrastructure for our world. It’s a trend that has been evident for a while but is now having a powerful impact. We will discuss W. Brian Arthur claim that, “digitization is creating a second economy that’s vast, automatic, and invisible—thereby bringing the biggest change since the Industrial Revolution.”

Intro: In 1850, a decade before the Civil War, the United States’ economy was small—it wasn’t much bigger than Italy’s. Forty years later, it was the largest economy in the world. What happened in-between was the railroads. They linked the east of the country to the west, and the interior to both. They gave access to the east’s industrial goods; they made possible economies of scale; they stimulated steel and manufacturing—and the economy was never the same.

Deep changes like this are not unusual. Every so often—every 60 years or so—a body of technology comes along and over several decades, quietly, almost unnoticeably, transforms the economy: it brings new social classes to the fore and creates a different world for business. Can such a transformation—deep and slow and silent—be happening today? [Register at McKinsey to see the rest]

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