Translated from German with the help of AI. The original is the authoritative version.
Modern humans have existed for roughly 200,000 years. Yet only for the last 250 years or so, during a vanishingly small slice of our history — about 0.125 percent (!) — have we experienced something one can call, without exaggeration, historically extraordinary: sustained progress.
For the largest part of human history, hunger, disease, pain, and early death were not the exception but the rule. Life was short, hard, and uncertain. Only around 1750 did a developmental surge begin that lifted millions of people, step by step, out of poverty, misery, and the impositions of the bare state of nature. Life became not only longer, but also safer, healthier, and happier. Globally, life expectancy in 1900 still stood at about 32 years; today it exceeds 70. Two centuries ago, every second child worldwide died before reaching adulthood. Today the global rate is just over 4 percent. Extreme poverty has also fallen dramatically in long historical comparison. Progress since then meant not just more consumption or more comfort, but ultimately a life with more dignity.
Yet this is also exactly why progress has never produced only enthusiasm. For some, the past 250 years are not the beginning of a new era for humanity but rather a historical exception. Before 1750, there had been almost no meaningful growth for centuries. So why should our brief phase of ascent last forever? This skepticism shaped the debates of the 2000s and 2010s above all. Robert J. Gordon argued in 2012 that the rapid progress of the past 250 years might in the end prove to be a one-time chapter in human history. Other researchers asked whether ideas had become harder to find than before, or whether innovation itself had slowed. Behind these diagnoses always stood the same suspicion: that progress is not self-evident, and that as knowledge grows, so do the hurdles for new breakthroughs.
These diagnoses were not merely cultural-pessimist folklore. Gordon spoke of the great one-time upheavals of the second industrial revolution, of electricity, running water, motorization, and sanitation, that is, of those inventions that made human life not just more pleasant, but civilized in the first place. The pessimism of recent years was therefore not necessarily irrational. It was a reaction to real slowdowns, to actual bottlenecks, and to a perceptible institutional fatigue.
And then came the AI boom. It is still hard to say how large the long-term impact of artificial intelligence will actually be, whether it will turn out to be a revolutionary general-purpose technology or rather one more, if extraordinarily useful, tool, much like Excel once was. One thing is already clear: within a few months, tools became broadly available that would previously have required a research lab, a serious budget, or an entire IT department. Programming, text production, translation, image editing, data analysis, literature research, and even parts of medical preparatory work were democratized in a way that would have been barely imaginable in the debates of the 2000s and 2010s.
The case of Rosie illustrates this especially well. When the dog was diagnosed with an incurable form of cancer, her owner first ran into a series of bureaucratic hurdles trying to access experimental treatment options. In the end he decided, with the help of ChatGPT, Gemini, and Grok, to develop a personalized mRNA treatment, and the vaccine worked. One need not declare this episode proof of a new era. But one would have to look away on purpose not to see in it at least a hint of changed possibilities.
This is only one of several examples that show why stagnation anxiety is less convincing today than it was a few years ago. AI promises productivity gains in nearly every field. It lowers access costs, shortens search processes, and puts tools into the hands of individuals that were once available only to large organizations.
And yet, strangely, the debate continues. For even when AI contradicts the stagnation worry, the discussion remains mostly fixed on technology. We talk about algorithms that improve the efficiency of language models, about better, smaller, and faster chips, about benchmarks, model sizes, and compute capacity. Much more rarely do we talk about the conditions under which technologies actually become progress.
Patrick Collison and Tyler Cowen described progress as the combination of economic, technological, scientific, cultural, and organizational progress. This last point is often underestimated. Progress is not simply a new device. It is a whole arrangement of rules, expectations, institutions, and practices that makes a device, an idea, or a discovery effective in the first place. Collison and Cowen therefore also wrote that progress itself is understudied. And they are right.
Right here lies a blind spot of many progress debates. Technology is not the same as progress. Technology needs institutional environments. A language model alone does not make an economy more productive. Only when there are institutional forms that can take up, spread, scale, and correct new possibilities does an invention become more than an impressive demo. The economist Joel Mokyr has pointed out that it is not enough to believe in progress. One has to produce it. For him, the modern world began when people decided to do exactly that.
This shifts a different question into the center of the progress debate: what if the real bottleneck for progress today is not primarily technological, but institutional?
The modern territorial state was without doubt one of the great coordination achievements of the modern era. It created legal certainty, standardized rule, built infrastructures, and provided that basic order without which modern markets would hardly be conceivable. But precisely because it was so successful, we tend to treat it as the self-evident and final form of social organization. That is a mistake. The nation-state is not a force of nature. It is a historical form of organization. And like every large organization, it has specific weaknesses.
One, if not the most important, weakness of large organizations lies not only in their inertia, but in their limits of calculation and information. The more coordination takes place within an organization, the more it has to make decisions administratively, often without the very information that the market would otherwise supply. Prices in the market process are not just cost figures; they are condensed information about scarcities, alternatives, and opportunity costs. Large organizations increasingly replace such signals with internal procedures, reporting chains, and transfer-pricing systems that never quite reach the original. They therefore react to the new not only slowly, but often imprecisely. With the state, this problem sharpens further. It lacks not only the discipline of bankruptcy. It also cannot correct misjudgments through profit and loss the way competitive actors must. Errors therefore rarely cause a structure to disappear; instead they usually lead to new procedures, additional responsibilities, and further bureaucratic thickening. Political incentive structures reward caution more than risk, control more than experiment, and visibility more than efficiency. The result is not necessarily standstill, but a structural braking effect on the new.
In Germany, this pattern is especially familiar. Founders, young companies, and research-intensive firms have complained for years about growing bureaucratic burdens. This is exactly why progress cannot be discussed only as a question of new technologies. The problem becomes even clearer when a society actually wants to keep up technologically but at the same time ties itself down with regulation. In April 2026, Chancellor Friedrich Merz declared that industrial AI in Europe needs less strict regulation than previously envisaged. Even political decision-makers who explicitly want progress now see that institutional structures themselves have become the bottleneck.
While the state works slowly and cautiously as a central information machine, forms of decentralized coordination are emerging in many places that learn faster, use local knowledge, and make mistakes cheaper. One of the best-known examples is Silicon Valley. It was never merely a collection of clever engineers. It was a network ecosystem of capital, talent, universities, informal norms, suppliers, founders, and a culture that treated the experiment not as exception but as normal case. Open-source communities work similarly. They coordinate globally distributed knowledge without a central command structure. Remote-first companies and digital entrepreneur networks likewise show that productive cooperation today is often organized beyond classical spatial and administrative boundaries.
Politically and in terms of urban planning, too, we see first attempts at such experimental spaces. Special economic zones have shown in many countries that limited institutional deviations can produce enormous economic effects. Shenzhen is the best-known example. What began at the end of the 1970s as a special zone developed within a few decades into one of the most important technology and production centers in the world. Not every special economic zone becomes Shenzhen. But Shenzhen shows that institutional exceptions are not a technocratic detail, but under the right conditions the starting point of entire waves of development.
Equally interesting are smaller, often less noted experiments. Estonia, with its digital administration and eResidency, did not create a new state model, but it did provide an example of how administrative ease can release entrepreneurial activity. Anyone who takes this thought seriously sooner or later arrives at competition between systems. Not competition in the crude geopolitical sense, but competition between institutional arrangements. If progress depends on how well a society processes knowledge, allows experiments, protects property, absorbs errors, and tries out new rules, then the central question becomes why we still organize these conditions almost exclusively within rigid uniform national orders.
Here the idea of Free Cities enters. The basic idea is at once simple and radical: instead of fixing every rule at the national level for everyone at once, one creates limited spaces with their own stable and credible institutional orders. These spaces can be more flexible in regulation, test new forms of administration, attract investment, and offer their residents better options. Free Cities are therefore new cities with special jurisdiction, intended to enable alternative governance systems at the local level. Or, more pointedly: more autonomy, more freedom, and more room to experiment for whole communities, not only for companies.
Of course, this is no miracle cure. Not every planned city will be free, not every special jurisdiction successful, and not every governance experiment politically viable. The case of the ZEDEs in Honduras shows precisely how contested such projects are. In 2024, the Honduran Supreme Court declared the self-administered ZEDEs unconstitutional. That does not underline the uselessness of the idea, but rather its political weight. System competition is most dangerous to existing orders precisely when it makes real alternatives visible.
And that is exactly the point. The perhaps most important progress of our time may not lie only in new models, new chips, or new medicines. It could be institutional in nature. Societies are slowly learning again that governance, too, can be thought of as modular, experimental, and competitive. The nation-state was a successful coordination form of the modern era. But it does not have to be history’s last word. Just as markets benefit from competition, political and administrative systems could benefit too, when people have more real choices between different orders.
Perhaps the pessimists of the 2000s and 2010s were only half wrong. Perhaps progress really does become harder when knowledge grows, research becomes more expensive, and organizations grow sluggish. But it does not follow that the age of progress is ending. It could just as well mean that the next great wave of innovation will come not only from the lab or the screen, but from the reorganization of how we live together. The decisive breakthrough would then lie not only in what we invent, but in the systems within which we are allowed to invent.
