Robert J. Gordon and the End of an Exceptional Century

Fundacja Dobre Państwo • January 18, 2026 • 🇵🇱 Polski

Introduction: Is Progress Inevitable?

Is progress a law of nature or merely a historical accident? In his analysis, Robert J. Gordon argues that the era of rapid prosperity growth was a one-time phenomenon. This article challenges the belief in perpetual development, highlighting the flaws of GDP as a metric and mounting structural barriers. You will learn why digital innovations may fail to replicate the success of indoor plumbing and which "headwinds" are currently stalling the real social advancement of most citizens.

The Special Century and the Illusion of Linear Growth

Gordon defines the years 1870–1970 as the special century. It was a unique period of transition from near-medieval conditions to the networked home—equipped with running water, electricity, and telephone service. This infrastructural revolution was a one-off event; one cannot discover fire twice. It is an extrapolation error to assume that because growth rates were high then, they must remain so in the future.

GDP is a flawed metric that fails to capture real improvements in quality of life, such as the decline in the disutility of work (physical toil) or increased safety. Even medical progress after 1970 has different economic characteristics: it is more expensive and less effective, focusing on diseases of old age rather than the mass saving of children’s lives, which previously triggered leaps in productivity.

Four Headwinds: Barriers to Real Prosperity

Modern growth is being slowed by four powerful forces. Income inequality acts as a filter: GDP may rise, but the fruits go to the wealthiest, as seen in the drastic divergence between mean and median incomes. Education, once the fuel of the economy, has slowed due to costs and market saturation, becoming a "headwind" for productivity.

Demographics and aging populations act as a mechanical brake—a smaller workforce must support a growing group of beneficiaries. The final factor is the fiscal headwind. Public debt forces reverse redistribution: future taxes and benefit cuts systematically erode household disposable income. For business, this represents a systemic risk—a lack of social legitimacy for growth that does not translate into wages.

AI and the Crisis of Capitalism: Can Productivity Still Be Shared?

Artificial intelligence offers hope for breaking Gordon’s pessimism. Techno-optimists point to the J-curve: initial stagnation caused by the need to reorganize processes, followed by a sharp spike in efficiency. However, Gordon warns that technology alone will not remove the institutional wedges driven between production and distribution.

The key question is: can modern capitalism still convert productivity gains into widespread material advancement? There is a risk that AI will merely become a tool for converting growth into owner dividends, offering the masses only cheap digital entertainment instead of existential security.

Summary: Progress Is More Than Just Statistics

Gordon’s analysis is a call to decouple growth from prosperity. True progress is not about constantly increasing GDP, but about the fair distribution of the fruits of labor and the economy's ability to improve the lives of the median citizen. In the pursuit of digital perfection, are we losing sight of fundamental aspects of human well-being? Perhaps it is time to focus on repairing the broken bond between productivity and social advancement rather than on indicators alone.

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Summary

In his analysis, Robert J. Gordon challenges optimistic assumptions of infinite progress, pointing to the unique nature of the century 1870–1970. The author argues that the contemporary economy faces four "headwinds": demography, education, inequality, and public debt, which permanently reduce growth rates. The text sheds new light on the difference between statistical GDP growth and the real well-being experienced by citizens, emphasizing the importance of median income. Gordon critically assesses the impact of modern technologies and artificial intelligence, suggesting that their transformative potential may be less than that of past inventions. This is a provocative read for anyone seeking to understand the mechanisms shaping our economic future and the limits of civilizational development in an era of growing fiscal and social challenges.

Frequently Asked Questions

Why does Robert J. Gordon call the years 1870–1970 “an exceptional century”?

Because at that time there was a one-time civilizational leap thanks to fundamental technologies (water, electricity, telephone) that cannot be discovered or implemented a second time.

What are the main “headwinds” hindering contemporary economic growth?

Gordon mentions primarily growing income inequality, problems with the education system, an aging population (demography) and growing public debt (tax office).

Why is GDP a treacherous measure of prosperity according to the author?

GDP only measures the market flow of values, omitting invaluable aspects that are crucial for the quality of life, such as a decrease in mortality, increased safety or shorter working hours.

Will artificial intelligence eliminate differences in employee competences?

The text suggests skepticism: AI may act as a multiplier that increases the productivity of mainly those already highly competent, which could deepen inequality.

How does inequality affect society's perception of economic growth?

Inequality acts as a wedge, ensuring that the benefits of GDP growth go mainly to the wealthiest, while keeping the real disposable income of the median population stagnant.