Experience wins (again- and in an unexpected place)…
July 28, 2012
Moore’s Law– Intel co-founder Gordon Moore’s assertion that the number of transistors on integrated circuits doubles approximately every two years*– is one of the best-known axioms of our time, a rule of thumb that helps explain the explosion of technological capability over the last several decades, at the same time that it reassures us of advances-to-come. It’s attained this status the old-fashioned way: by being largely right– which is to say reasonably accurately predictive.
But as IEEE Spectrum reports, recent research at the Santa Fe Institute suggests that the broader concept on which Moore’s law was founded, the Experience Curve, is actually a better predictor of technological progress than Moore’s refinement.
Bruce Henderson and BCG tend to get credit for the idea of the Experience Curve (or the Learning Curve)– the notion that the costs of technological items drop with their cumulative production. BCG certainly did make hay with the concept back in the late 60s. But the concept dates back to the 19th Century and the work of German psychologist Hermann Ebbinghaus. Then in 1936, Theodore P. Wright observed the phenomenon in aircraft manufacture (“Factors Affecting the Cost of Airplanes,” Journal of Aeronautical Sciences and ”Learning Curve”, Journal of the Aeronautical Sciences), and coined “Wright’s Law” describing the effect.
Moore’s Law seems to be a special case of Wright’s Law; and in fact, Wright’s Law seems to describe technological evolution a bit better than Moore’s—not just in electronics, but in dozens of industries.
A new Santa Fe Institute (SFI) working paper (Statistical Basis for Predicting Technological Progress, by Bela Nagy, J. Doyne Farmer, Quan M. Bui, and Jessika E. Trancik) compares the performance of six technology-forecasting models with constant-dollar historical cost data for 62 different technologies—what the authors call the largest database of such information ever compiled. The dataset includes stats on hardware like transistors and DRAMs, of course, but extends to products in energy, chemicals, and a catch-all “other” category (beer, electric ranges) during the periods when they were undergoing technological evolution. The datasets cover spans of from 10 to 39 years; the earliest dates to 1930, the most recent to 2009.
It turns out that high technology has more in common with low-tech than we thought. The same rules seem to describe price evolution in all 62 areas.
Read the whole story at “Wright’s Law Edges Out Moore’s Law in Predicting Technology Development.”
* “Two years” became, in common understanding, “18 months” when Moore’s colleague David House revised the estimate to account for faster chips contributing to the the acceleration of further development.