One of my favorite example of a mindless extrapolation was a headline I saw a few years back that said “By 2100 We Will All Live In Cities” (sadly I can’t find it anymore and failed to bookmark it). It may have been slightly exaggerated for dramatic purpose, but it is easy to find extrapolations that say by 2100 more than 80% of the global population will live in cities. Here is an example from the World Economic Forum:

You will readily get there if you simply extrapolate charts like this one from Our World in Data.

But extrapolation is dangerous (much more so than interpolation). In extrapolation you are assuming that the trends driving the observed changes will continue in their present form. That’s largely safe when you are dealing with simple physical systems like the trajectory of a single tennis ball. But when you are dealing with a system of massive complexity such as human societies, it is generally a terrible idea, especially over more than a few years.

There are many confounding factors, but the one I am most interested in is innovation. Suppose you had gone back to the year 1800 and extrapolated urban population based on the last 300 years, you might have come up with an estimate for the year 1900 of say 10% urban population and been off a fair bit (actual number 16%). Then in 1900 again even if you had allowed for significant further acceleration you would have likely put 2000 at maybe 30-some% instead of the 47% that actually occurred.

In retrospect it is easy to know how how innovation upended extrapolation. Building improvements made much denser urban centers possible. Work changed from agriculture to manufacturing and with industrialization came economies of scale which required large factories.

But further innovation today is starting to work in the opposite direction.With COVID-19 we have seen a massive acceleration in remote work with a spike in demand for rural real estate. For now the possibility of remote work is available only to some segment of the population. With more automation though we might eventually wind up with a new social contract that involves some kind of universal basic income. That would radically alter the relative growth urban and rural population. Most rural areas are deserted today not because people hate it there but rather because people can’t afford to live there. Agriculture has been highly mechanized dramatically reducing the number of jobs and most economic activity has become concentrated in urban areas.

I love cities and have visited many of them around the world. But I also grew up in the country side of Germany and am happy walking and working in a forest. I am super fortunate in that I can split my time between the country and the city and I believe that in the future there will be more flexibility for more people to experience both in their lives. Here too, innovation will play a crucial role. For example, some level of autonomous driving is already transforming how exhausting a drive is. And services like AirBnB and HipCamp make it possible to spend time periods in different places.

In summary then: using extrapolation, you would have underestimated future urbanization in the past and are very likely to be overestimating it now. Both times dues to innovation.

PS This will be the first in a series of posts. The next one will be on land use.

One of my favorite example of a mindless extrapolation was a headline I saw a few years back that said “By 2100 We Will All Live In Cities” (sadly I can’t find it anymore and failed to bookmark it). It may have been slightly exaggerated for dramatic purpose, but it is easy to find extrapolations that say by 2100 more than 80% of the global population will live in cities. Here is an example from the World Economic Forum:

You will readily get there if you simply extrapolate charts like this one from Our World in Data.

But extrapolation is dangerous (much more so than interpolation). In extrapolation you are assuming that the trends driving the observed changes will continue in their present form. That’s largely safe when you are dealing with simple physical systems like the trajectory of a single tennis ball. But when you are dealing with a system of massive complexity such as human societies, it is generally a terrible idea, especially over more than a few years.

There are many confounding factors, but the one I am most interested in is innovation. Suppose you had gone back to the year 1800 and extrapolated urban population based on the last 300 years, you might have come up with an estimate for the year 1900 of say 10% urban population and been off a fair bit (actual number 16%). Then in 1900 again even if you had allowed for significant further acceleration you would have likely put 2000 at maybe 30-some% instead of the 47% that actually occurred.

In retrospect it is easy to know how how innovation upended extrapolation. Building improvements made much denser urban centers possible. Work changed from agriculture to manufacturing and with industrialization came economies of scale which required large factories.

But further innovation today is starting to work in the opposite direction.With COVID-19 we have seen a massive acceleration in remote work with a spike in demand for rural real estate. For now the possibility of remote work is available only to some segment of the population. With more automation though we might eventually wind up with a new social contract that involves some kind of universal basic income. That would radically alter the relative growth urban and rural population. Most rural areas are deserted today not because people hate it there but rather because people can’t afford to live there. Agriculture has been highly mechanized dramatically reducing the number of jobs and most economic activity has become concentrated in urban areas.

I love cities and have visited many of them around the world. But I also grew up in the country side of Germany and am happy walking and working in a forest. I am super fortunate in that I can split my time between the country and the city and I believe that in the future there will be more flexibility for more people to experience both in their lives. Here too, innovation will play a crucial role. For example, some level of autonomous driving is already transforming how exhausting a drive is. And services like AirBnB and HipCamp make it possible to spend time periods in different places.

In summary then: using extrapolation, you would have underestimated future urbanization in the past and are very likely to be overestimating it now. Both times dues to innovation.

PS This will be the first in a series of posts. The next one will be on land use.