Carl Benedikt Frey, "How Progress Ends: Technology, Innovation, and the Fate of Nations" (Princeton UP, 2025)

Oct 17, 2025

Carl Benedikt Frey, a renowned economist and historian of technology, explores the intricate relationship between innovation and societal progress. He argues that while technological advancements can lead to success, they also risk stagnation when institutions fail to adapt. Frey uses historical examples, like the shifts in Song China and Victorian Britain, to illustrate how decentralization and bureaucracy must coexist. He also discusses the role of AI, warning that while it enhances productivity, it hasn't yet reached the transformational impact of past innovations.

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INSIGHT

Exploration Then Execution

Innovation requires both open exploration and disciplined execution at different stages.
Decentralized exploration spawns ideas while centralized execution scales proven ones.

ADVICE

Match State Role To The Task

Use the state differently depending on whether you need exploration or exploitation.
Fund decentralized university networks for discovery and centralized projects for clear objectives.

INSIGHT

Competition Triggers Reform

External competition often forces liberalizing reforms that enable innovation.
Military or economic defeat historically triggered reforms that opened space for exploration.

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In How Progress Ends: Technology, Innovation, and the Fate of Nations (Princeton UP, 2025), Carl Benedikt Frey challenges the conventional belief that economic and technological progress is inevitable. For most of human history, stagnation was the norm, and even today progress and prosperity in the world’s largest, most advanced economies—the United States and China—have fallen short of expectations. To appreciate why we cannot depend on any AI-fueled great leap forward, Frey offers a remarkable and fascinating journey across the globe, spanning the past 1,000 years, to explain why some societies flourish and others fail in the wake of rapid technological change. By examining key historical moments—from the rise of the steam engine to the dawn of AI—Frey shows why technological shifts have shaped, and sometimes destabilized, entire civilizations. He explores why some leading technological powers of the past—such as Song China, the Dutch Republic, and Victorian Britain—ultimately lost their innovative edge, why some modern nations such as Japan had periods of rapid growth followed by stagnation, and why planned economies like the Soviet Union collapsed after brief surges of progress. Frey uncovers a recurring tension in history: while decentralization fosters the exploration of new technologies, bureaucracy is crucial for scaling them. When institutions fail to adapt to technological change, stagnation inevitably follows. Only by carefully balancing decentralization and bureaucracy can nations innovate and grow over the long term—findings that have worrying implications for the United States, Europe, China, and other economies today. Through a rich narrative that weaves together history, economics, and technology, How Progress Ends reveals that managing the future requires us to draw the right lessons from the past.

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