A couple of months ago I wrote about Kondratieff cycles, the long-run waves of innovation that can be observed since in the industrial revolution. Many believe that we’re entering a sixth, which will be a transition towards sustainable technologies. Here’s a graph that describes the same phenomenon much more neatly. It’s from the Ellen MacArthur Foundation, which campaigns for a ‘circular economy’.
One of the notable things about these waves of innovation is that they created enormous wealth and social progress in the places where they started. From early industrialization in Britain to consumer electronics in Japan, the countries that capitalized early on the emerging technologies reaped economic benefits for an entire generation or more.
The lesson for business and government is that if we are entering a 6th wave, you ignore renewable energy and cradle to cradle design at your peril. We might decide not to invest, not to commit funds to research and development, but others will. I can only really speak for British politics, but current government policy (or lack of it) is distinctly lukewarm towards sustainable energy and production. That could turn out to be a very big mistake.
This wave looks doubly important, because many of the previous technologies are now hitting natural limits. Raw materials such as metals aren’t necessarily running out, but demand has increased and they are much more expensive. The price of fossil fuels is rising and will continue to do so. Economies running an old industrial model are going to find their inputs are increasingly expensive, cutting into profits. Those investing now in resource productivity, re-use, leasing, and smart design are going to have a major headstart.