250 Years Like No Other

Technological innovation ultimately sustains economic growth, and investors should focus on the long-term value created by AI rather than short-term market enthusiasm.

• The 2025 Nobel laureates Philippe Aghion, Peter Howitt and Joel Mokyr argue that sustained growth results from creative destruction, with technological advances creating more jobs than they destroy.
• The first Industrial Revolution illustrates how policy shaped outcomes: scientific publications increased across Europe, while the number of instrument makers rose sharply in England but not France; England’s more capitalist embrace of change helped it become a global superpower.
• Redmond argues that US innovation has driven much of the last century’s growth, reducing poverty and food insecurity through transportation, electrification and refrigeration, and notes Nvidia’s Jensen Huang as an example of an influential first- or second-generation immigrant.
• AI is presented as the next major technological transformation; a Deutsche Bank chart showed software-engineer job listings rising over the last year even as total job listings declined, contrary to the idea that AI is already eliminating such work.
• The market’s current enthusiasm for AI resembles the early internet boom: after peaking in early 2000, the NASDAQ took nearly 15 years to recover, despite the internet’s eventual value creation.

Takeaway: Investors should formulate long-term theses around the value created by AI rather than predict short-term voting patterns, while recognizing that the article’s optimistic outlook depends on the American innovation model remaining intact.