Shall we talk about innovation?

The economist Schumpeter described innovation as a "new combination."

This means creating new value by combining elements that have never been combined before. He proposed that innovation brings about economic change not only through technological innovation, but also through five types: new products, production methods, sales markets, sources of supply, and organizations, and that combining these leads to economic innovation.

The keyword is "economic innovation."
In "Macroeconomics" written by Paul Krugman and Robin Wells, it was written that an economy refers to a "system for coordinating a society's productive activities." In other words, there is a series of activities in the world where goods and services necessary for people to live are produced, distributed, allocated, and consumed, and the term "economy" refers to the "entire social system that coordinates them."

From that perspective, the spread of smartphones can be said to be the greatest innovation in recent years in that it has completely changed the purchasing behavior patterns of people around the world. On the other hand, generative AI has not yet reached the point of changing people's purchasing behavior. Generative AI is still in the midst of innovation.

(It may not feel much like innovation, but) the spread of e-commerce has also brought about a transformation in people's purchasing behavior patterns. Furthermore, considering that it has changed not only the entire distribution mechanism but also the way of thinking about supply chain management, the impact of the innovation that e-commerce has had on the world may be even greater than that of smartphones. (However, there is also the aspect that much of the spread of e-commerce was made possible by the spread of smartphones...)