Complexity Quote by Erik Brynjolfsson
““The complexity for minimum component costs has increased at a rate of roughly a factor of two per year. . . . Certainly over the short term this rate can be expected to continue, if not to increase. Over the longer term, the rate of increase is a bit more uncertain, although there is no reason to believe it will not remain nearly constant for at least ten years.2””
About This Quote
Source Paper: Economics of Technology, 2020
Cost of components is rising exponentially, roughly doubling each year, and may stay high for a decade.
In simple terms: Component costs double yearly, likely staying high.
Key Takeaway
Plan for higher expenses in budgeting.
Themes
technology
economics
cost management
Mood
cautious
analytical
Type
analytical
forecasting
When to use this quote
- product development
- manufacturing
- procurement
- financial planning
Key Concepts
exponential growth
inflation
supply chain
innovation
budgeting
Questions to Reflect On
- How will you adapt budgeting to rising costs?
- Can new technologies reduce future expenses?
A Different Perspective
Assumes past trends continue; may overlook disruptive breakthroughs.
![“[In science any model depends on a pre-chosen taxonomy] a set of classifications into which we divide the enormous complexity of the real world... Land, labor, and capital are extremely heterogeneous aggregates, not much better than earth, air, fire, and water.” quote by Kenneth E. Boulding](https://sms4smile.com/quotes/img-quotes/47e/kenneth-e-boulding-3728_air_in-science-any-model-depends-on-a-pre-ch_12383.jpg)
