Cesar Hidalgo’s “Why Information Grows” offers a model of economic growth that eschews the usual suspects of capital, labor, and innovation in favor of a model of the economy as a “collective computer.”

Why Information Grows: The Evolution of Order, from Atoms to Economies (Basic Books, 2015) by MIT’s Cesar Hidalgo offers a model of economic growth that eschews the usual suspects of capital, labor, and innovation. Hidalgo, a statistical physicist by training, sees an economy as a “collective computer” formed of myriad human networks. At the heart of Hidalgo’s model are matter, energy, and information. By “information,” Hidalgo means the physical order of atoms, how they are arranged. When that order is changed — say when a fancy car hits a wall — there has been a change in information, although not a change in the amount of matter.

Or think about when a child is born. Hidalgo sees the journey from womb to the delivery room as a “hundred-thousand-year journey from a distant past to an alien future.” The difference between those two worlds — the modern one filled with objects constructed from our imagination — resides in how the atoms constituting matter are arranged. And processing information, using energy to change physical order in a way that gives meaning or value, is what economies do. The greater such computational capacity, the greater capability an economy has to make information grow and the greater the possible complexity of economic activities such as making an iPhone or a Tesla.

Countries with less computational capacity might only be able to produce commodities or simple products. They are less able to create the physical objects that embody and accumulate information, what Hidalgo calls “crystals of imagination.” Hidalgo argues that what separates national economies that possess high computational capacity from the ones that don’t are the size of social networks, themselves partially dependent on the level of trust in a society. Hidalgo: “So the social and economic problem that we are truly trying to solve is that of embodying knowledge and knowhow in networks of humans.”And by doing that, we can distribute and expand our computational capacity and help information grow — and our economies, too.

As I see it, then, pro-growth policies are pro-connection policies that help more humans more easily acquire and communicate knowledge over large networks. (Markets are good at encouraging this.) Bridges good, barriers bad. Supply chains good, tariffs bad. Also good: Policies that make it easier to move to and live in high productivity cities and regions. Also bad: non-compete agreements and overly burdensome occupational licensing rules. I would love to read Hidalgo’s ten-point agenda.