Here is your typical breathless futurism, pulled off Digg. Let’s assume the guy is right, and there will be purely virtual marriages, replete with virtual you-know-what, and many people will live full (virtual) lives without ever leaving their living rooms, etc.
In this world virtual nookie and related activities reap high-productivity gains and the price of such activities falls rapidly. They become a tiny percentage of gdp, much as agriculture has today, even though they are very important for our utility. The low-productivity activities — most of all face-to-face meetings — take up a big chunk of gdp, much as health care and education do today. Imagine that meetings for a cup of coffee are highly expensive (in relative terms), they require subsidy, and Robert Samuelson writes Op-Eds about how they will bankrupt us. Shocks to "the meeting sector" can send the economy into a tailspin.
In relative terms, transportation costs, broadly construed, will be exorbitantly high. By comparison, standard legal tariffs won’t much matter and political boundaries will lose most of their influence over the geographic distribution of economic activity. Immigration will cease to be a major political issue, if only because it is so (in relative terms) costly. Why cross a border when you must give up many of your virtual lives to buy the bus ticket? Dialects will proliferate and styles of art, at least those in meatspace, will take divergent paths.
As with education today, people will try to get their (costly) meetings over with early in life. Again, in opportunity cost terms, it’s not worth it for most people to give up so much virtual life just to go see Cleveland. Maybe meetings will become the new middle class entitlement, and subsidies to Amtrak will replace Social Security or Medicare as the largest item in the federal budget. Some columnists will claim that the government can supply meetings more cheaply. Conservatives will insist that people have to pay for their own meetings, and that certain social classes are taking advantage of the meetings privilege.
The price of land in cities will be very low, since people will have been able to spread out and conduct most of their lives from a distance. So meetings are inefficient, but when they do occur they will never be cramped. People will talk with their hands much more, because there will be no danger of hitting the people at the next table. Umbrellas will be large and bulky, and you won’t need to get that flu shot. Restaurants will have room for expansive smoking sections.
The Alchian and Allen theorem will imply that only high-quality meetings will take place. Why incur a high meeting/transport cost for a mere piffle of a kiss on the cheek, or for the exchange of a small piece of gossip? Meetings will be highly intense, extremely memorable, and involve well thought out sexual extravaganzas.
Umbrellas are too small as it is, so I am more upbeat about this new online gaming future.
More of this, please. What other improbable outcomes need analyzing?
I think the largest impact of online games will be research into how to make superficially tedious and repetitive tasks seem (be) meaningful and fun.
I don’t know where I read it, but someone made the point that within 50 years it will be possible to connect a human being to a computer that allows him/her to live a virtual life with robots taking care of the physical bodies, and that not long after this, the entire consciousness could be contained within a computer. He then pointed out that since it would be impossible to tell what is real and what is not, that we all were, in fact, already computer animation and just don’t know it any longer.
This list is most certainly of the tongue in cheek sort. Cracked.com is not a futurism site, but a humor site who’s front page currently features articles such as “9 Most Badass Bible Verses” and “15 (painfully) Unforgettable Cartoon Theme Songs”.
Inexpensive face-to-face meetings will still take place. In a fully-connected world people will be able to voluntarily self-segregate into physical neighborhoods of like-minded individuals. Picture a college dorm where friends stay put indefinitely instead of graduating and dispersing across the country. Or a permanent symposium.
Cheap slow-motion travel may prevail, in a world where you can take your iPod/Kindle with you and stay online with ubiquitous connectivity. Rapid arrival will be less important when travel does not impair your ability to get work done or cut you off from your personal libraries, contacts and resources. Highways and airports and railroads will probably be used mostly for shipping perishable goods; people will take the slow boat (or dirigible) to China, in leisurely migrations from one self-segregated physical neighborhood to another (“let’s spend next spring in Spanish Libertaria, and summer at the Chinese Food campus”).
It’s hard to make predictions about physical infrastructure, though, because of game-changing technological advances. For instance the Erie Canal, a vital economic resource in its time, is today merely a historical curiosity.
Virtual worlds like Second Life are overhyped, but it is a truism that we always overestimate the short-term impact and underestimate the long-term impact of new technologies. In much the same way that it is far easier to do movie special effects by using CGI to paint a frame of film rather than building a physical model and pointing a camera at it, in the future it will be far cheaper to “paint” our nerve endings rather than building physical objects and interacting with them. Who know, this may be one reason why SETI has failed: advanced aliens probably have as much interest in living in the physical universe as we would in living out a hunter-gatherer existence in the grasslands of east Africa.
I think you’ve got it reversed: physical-world activities will be the “agriculture”, occupying a small proportion of GDP and employment in order to keep the data networks infrastructure and factories humming. The vast majority of GDP will be caught up in some sort of virtual-world attention economy that we can’t yet imagine. An analogy would be a medieval king trying to grasp how it is that in New York, a city of millions, a huge proportion of economic activity is tied to a “financial sector” where wealth is tallied not with pieces of gold but with electrons, magnetic fields and bits of paper. To most of our ancestors, we are already living in something of a virtual economy.
W/r/t transaction costs, this has already happened. Many people spend time watching TV or playing video games, not because it’s more or just as fulfilling, but because it takes a lot less effort and planning to do something within your house than out in the world and collaboratively. In terms of transaction costs, rather than prices, the virtual already *is* much cheaper, and that’s part of the problem.
The idea that this would come to be reflected in prices is, I think, a little farfetched: a great bulk of transportation costs involve the distribution and provisioning of goods and services to the point where they’re required. This includes not only shipping but also housecleaning, construction, etc. If you posit a more spatially distributed and homebound society, these costs are likely to *increase*, rather than decrease.
Our great hope, in saving ourselves from The Matrix that we are already succumbing to, is to figure out how to make real-world engagement as low-cost, as easy, as rewarding, and as ad-hoc, as watching TV or playing computer games. Mobile technology is my great hope for this and I’m pushing on it hard, with my company citizenlogistics.com.
To see how online gaming will change the world check out webster’s newest word for 2007 “w007″ This term used by gamers to proclaim victory or express excitement over a win while gaming uses letters and numbers and is part of the l337 vocabulary. Chec it out. Now I am not a gamer, but no matter how exciting they may be travel is still more exciting to me. I enjot getting off my ass as much as possible to see real tangible things like foreign countries, or destinations with real people that I can talk to face to face.
To Yancey Ward
The person who discussed the merging of humans and computers is Ray Kurzweil. The Singularity is Near.
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