The answer is yes, by simple costs of communication. Communication is neither free in energy, nor instantaneous or faster than light. Fanout limits the speed too.
So essentially at some point the economy becomes unmanageable and unstable by pure lag. Earlier than that, by human reaction time and decision failures.
HFT is already riding on speed of light distance differences. If you grow the economy even more (in number of actors), the costs become exponentially higher.
And if you're talking real economy, then we're talking actual real resources which are even more finite and scarce than electricity and time lag.
I'm sorry to put it so crudely, but this doesn't make any sense.
It does not cost more in 'communication' to convey a better idea.
Moreover, communications cost is marginal, so even in an very theoretical scenario in which 'more economic activity requires more communication' - it's not applicable.
"And if you're talking real economy, then we're talking actual real resources which are even more finite and scarce "
Again this is completely false.
Education, Entertainment, Legal Services, Financial Services, R&D - i.e. 'Services' are the 'Real Economy'.
The 'Value Add' provided by applied intelligence is considerably greater than the raw, natural resources economy.
> Maybe we figure out how to control simply and cheaply store CO2 in pellets at the bottom of the ocean. Climate changed solved.
Well… yes, maybe we’ll figure out. But I hope you understand that’s a risky bet ? Climate change CAN be stopped rapidly. But it can’t be reversed (on centuries scale). So each catastrophe frequency increase, each heat record, each impact of the acidification of oceans that happen year after years is here to stay for centuries, at least.
I sincerely hope your CO2 pellets are for today, because if they are not, we will need another plan. And the only working one we have as of today is to stop burning fossil fuels.
> The issue is does increasing economic output, require increasing energy use? The answer is no.
The article addresses that by arguing that it would imply energy became arbitrarily cheap, while being scarce and finite. That means someone could buy the whole supply and wipe out their competitors. That contradicts it being arbitrarily cheap, so energy would be a limiting factor.
Which is a silly argument. There a lots of essential raw materials that have a market size of a few billion or less per year. Bezos could theoretically buy the entire years supply and cripple the economy.
For example, let's choose something expensive sounding -- platinum. 170 tons per year of production, at $30 million per ton. $5B will let you corner the market for the year. Yet it doesn't happen, for a wide variety of reasons.
For the analogy to work with energy and still be true to the physicist's argument, we would also have to imagine that all exchange of goods and services requires new platinum -- and that there's a hard physical limit on the platinum mining rate.
Perhaps a world where platinum jewelry is all that is bought and sold. Jewelers improve in skill and the jewelrt becomes ever more intricate and elaborate, such that its value grows ever higher than the raw platinum it's made from.
In such a world, there might be no limit on the jeweler's craft, but could the price of platinum really become arbitrarily small? As time goes on, first the world's greatest jeweler could afford the whole supply, but then even a second rate jeweler, and then eventually anybody could perhaps afford to buy all the raw platinum.
A: Platinum is an example, there are hundreds of other such resources.
B: Platinum is much easier to corner than energy would be, since platinum mining is limited to a very few number of active minutes. Energy production is quite distributed.
This is not the issue.
The issue is does increasing economic output, require increasing energy use? The answer is no.
The value unlocked from increasing applied intelligence doesn't require commensurately more energy in all cases.
If we figure out a cure for cancer, it'll likely have nothing to do with increased energy usage.
Maybe we figure out how to control simply and cheaply store CO2 in pellets at the bottom of the ocean. Climate changed solved.
Economic output is just a number, it's how we value the stuff we trade among one another.