US 'Wasted' Technological Opportunities That India Capitalised On, Says Nobel Laureate Paul Romer

The technological opportunities that were presented to the US were "wasted, squandered" and thus losing to India in the way technology is used with government regulations, according to Nobel Laureate Paul Romer.

The optimism about what can be done with technology is still correct and "I still believe it," the former chief economist of the World Bank said while addressing global leaders at the NDTV World Summit 2024. He added that problems like climate change can be tackled with technological innovation without compromising economic growth.

Romer, who debunked the theory that the global economy would be doomed as petroleum will run out in the 1990s said that history shows that we had "innovation on top of innovation" and the actual opportunity is very positive.

"The question is, if we are given opportunities, what do we do with those?" The digital opportunities what were given to the US were wasted and squandered phenomenally, Romer said. "The way to see what we (US) have lost is to compare the success in India in the way technology is used."

One sign of dramatic improvements in standards of living is the steadily increasing life expectancy across countries and across time, Romer highlighted. "Life expectancy has stopped increasing in the US and its actually falling," but Silicon Valley don't want to use that measure like before.

The technology has been used to improve the quality of life in India as the government decided to use technological opportunities to benefit everyone, he said.

Economists have done a "huge disservice" to the world by reinforcing the notion that government is the problem and the market is the solution, Romer said. "That's not true."

The Nobel Laureate drew parallel to the airline industry to highlight how the government must regulate to spread of technological benefits.

A big government in the sense of running the airlines is not needed but "we do need a strong government that can say you will lose your ability to fly planes if you don't follow regulations."

What is missing in the US is the lack of regulation to spread the benefits of innovation which is present in India, Romer said. "The Indian government is not afraid to set up standards that are to be followed. In our (US) country, people are scared of the government coming up with even an application."

There is a need to see the benefits that can accrue through governmental innovations, the Nobel Laureate said.

The benefit in India is that people can see in their daily lives the benefits that they have been able to enjoy because of government innovations, he said. "People see that the government has delivered."