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“The rise of industrial big data is moving at twice the speed of other big data. That’s a great opportunity.” said William Ruh, the head of global software at G.E. “There’s all kinds of experiences that we’re going to create.”

The other is a kind of application software to help power companies figure out how to best build out and operate their turbines. By October, G.E. hopes to have similar applications out for railway, mining, and oil and gas companies.

Effectively, G.E. is taking the data-driven tools and strategies used by Google and Facebook to the much larger global economy.

How Jean Tirole’s Work Helps Explain the Internet Economy

He also said that industries should be regulated differently depending on their distinct characteristics.

Internet companies like Amazon.com, Facebook and Google stay largely out of reach of tax collectors in large European countries like Britain, France and Germany by routing their sales through smaller countries, like Ireland and Luxembourg, where corporate tax rates are lower. The companies insist that such practices are permitted under European Union law and international taxation treaties.

The strategic technologies that have repeatedly transformed the market economy – from railroads to the Internet – required the construction of networks whose value in use could not be known when they were first deployed.

Consequently, innovation at the frontier depends on funding sources that are decoupled from concern for economic value;

Financial speculation has been, and remains, one required source of funding. Financial bubbles emerge wherever liquid asset markets exist. Indeed, the objects of such speculation astound the imagination: tulip bulbs, gold and silver mines, real estate, the debt of new nations, corporate securities.

The actual underwater cables that connect the Internet globally

On Tuesday, a company appearing at the Amazon conference said it had run in 18 hours a project on Amazon’s cloud of computer servers that would have taken 264 years on a single server. The project, related to finding better materials for solar panels, cost $33,000, compared with an estimated $68 million to build and run a similar computer just a few years ago.

“It’s now $90 an hour to rent 10,000 computers,” the equivalent of a giant machine that would cost $4.4 million, said Jason Stowe, the chief executive of Cycle Computing, the company that did the Amazon supercomputing exercise, and whose clients include The Hartford, Novartis, and Johnson & Johnson. “Soon smart people will be renting a conference room to do some supercomputing.”

This year, Gartner calculated that A.W.S. had five times the computing power of 14 other cloud computing companies, including IBM, combined.

“Pretty much every human on earth can access all human knowledge,” said Hal Varian, Google’s chief economist.

o how to measure the Internet’s contribution to our lives? A few years ago, Austan Goolsbee of the University of Chicago and Peter J. Klenow of Stanford gave it a shot. They estimated that the value consumers gained from the Internet amounted to about 2 percent of their income — an order of magnitude larger than what they spent to go online. Their trick was to measure not only how much money users spent on access but also how much of their leisure time they spent online.

Silicon Valley Tries to Remake the Idea Machine

The federal government now spends $126 billion a year on R. and D., according to the National Science Foundation. (It’s pocket change compared with the $267 billion that the private sector spends.) Asian economies now account for 34 percent of global spending; America’s share is 30 percent.

Perhaps more crucial, the invention of much of the stuff that really created jobs and energized the economy — the Internet, the mouse, smartphones, among countless other ideas — was institutionalized. Old-fashioned innovation factories, like Xerox PARC and Bell Labs, were financed by large companies and operated under the premise that scientists should be given large budgets, a supercomputer or two and plenty of time to make discoveries and work out the kinks of their quixotic creations.

Rent-seeking” is what economists call a special type of money-making: the sort made possible by political connections. This can range from outright graft to a lack of competition, poor regulation and the transfer of public assets to firms at bargain prices. Well-placed people have made their fortunes this way ever since rulers had enough power to issue profitable licences, permits and contracts to their cronies.

Capitalism based on rent-seeking is not just unfair, but also bad for long-term growth.

It identifies sectors which are particularly dependent on government—such as mining, oil and gas, banking and casinos—