Two helpful paradoxes, and moving home - by Sergio Visinoni

The piece lifts two classic economic paradoxes into the daily reality of tech leadership. Solow's productivity paradox reminds us that massive IT investment can leave productivity numbers flat, while Jevons' paradox flips the intuition that efficiency automatically cuts consumption. Both expose the hidden traps behind common assumptions about technology upgrades.

Solow's paradox is illustrated with the historical pattern of computer adoption: despite ubiquitous computers, early productivity stats showed no lift, and later waves of IT spending produced similar lulls before any measurable gains emerged. The author argues that the problem is often the choice of metric - measuring output without accounting for system bottlenecks can mask real benefits. The insight is that leaders must define the right productivity signals before declaring a win.

Jevons' paradox is brought forward through the current hype around AI-assisted coding. Even if LLMs dramatically speed up code generation, the paradox predicts that the lower cost of producing software may actually expand demand for engineers rather than shrink it. The article cites the recurring alarm that AI will replace software engineers and counters it with a more nuanced view: efficiency can fuel growth in the very market it seems to threaten.

For a technical leader the practical takeaway is clear: stop equating faster tools with less work. Scrutinize where the real bottleneck lies, choose metrics that reflect system-level outcomes, and anticipate that efficiency gains may spur new demand. This mindset protects teams from chasing shiny tech that delivers no real value and helps them allocate resources where they truly move the needle.

The broader lesson is to embed critical thinking about paradoxes into strategic planning. When a new platform promises "more output with less effort," ask how that effort translates into measurable business impact and whether it will create additional work elsewhere in the system. By doing so, leaders can steer investments toward changes that genuinely improve team performance and avoid the false promise of productivity miracles.