The Passion Economy by Adam Davidson

The Passion Economy: The New Rules for Thriving in the Twenty-First Century
by Adam Davidson
Alfred A. Knopf, 2020

Adam Davidson's grandfather, born in 1917, was a serious man. “With his grandchildren, he had a routine: a firm handshake followed by a gift of a twenty-dollar bill and some vague homily about doing good work, after which we were dismissed.” During the Great Depression he got married and luckily picked up a job at a factory producing external grinders. With a series of promotions that eventually lead him to run the factory, he didn’t leave until retirement 54 years later. Was he passionate about this job? No. “He got the job because his father-in-law knew a guy, and he stayed in the job because that’s what you did when you had a job. You stayed and tried to get promoted.”

Davidson’s father, on the other hand, had passions from a young age. These passions were channeled in a variety of ways, not all of them healthy. After being kicked out of the home, working in a shoe factory, and joining the marines, he eventually found himself at university. Just as he was about to flunk out, he was asked to fill a minor part in a play the school’s theater department was putting on. After a positive reception he transferred universities, entered theater school, and would become an actor.

The clear division between the world of Davidson’s grandfather and that of his father no longer exists: "Our economy can no longer be described with the simple binary of the twentieth century,” Davidson writes, “where on one side is money, stability, and routinization and on the other is passion, personal expression, and financial uncertainty.” This change, it is usually said with a sigh, has largely been brought about by trade and technological advancement. Against this gloomy disposition, in his new book The Passion Economy: The New Rules for Thriving in the Twenty-First Century, Davidson writes:

This is not all bad news. The same forces. . .that destroyed the widget economy have given birth to what I call the Passion Economy. The internet allows people who want to sell a unique product or service to find customers all over the world. Automation makes it possible for people to manufacture their unique products without needing to build a factory first. Advances in trade mean that those unique products can be delivered to the people who most value them, wherever they happen to be.

Adding that “this book lays out the economics of how this change happened and how you can take advantage of it.” But it is much more the latter than the former. In short, what he does is detail “the rules of the passion economy” and then aluminates these with case studies and anecdotes that span different professions, industries, lines of business, and people – especially people.

The book is most open to the criticism that many of the those cited as examples were uniquely placed for a kind of success that would not be attainable for most people facing technological unemployment (although Davidson is careful not to cite examples of success aided by inherited wealth or Ivy League education). And that on reflection many of the examples come across as so fanciful, and an economy with millions comparable to these individuals is difficult to imagine, is the main weakness of the book. Relatedly, he doesn’t get into the economics necessary to address more technical and sophisticated arguments about the consequences of such economic change. The Passion Economy isn’t, however, that kind of book. Davidson is adumbrating and illustrating rules of entrepreneurship, based on the sound economic theory of subjective value, for an economy that finds itself in a new space created by the Internet:

Computer technology, artificial intelligence, and automation don’t have to mean the soulless destruction of our individuality. They can achieve the precise opposite: passion-based organizations that promote individual happiness.

This is not an economics text and won’t shift paradigms, but neither is it an assortment of vapid bromides intended for those searching for the keys to business success. The book is endlessly positive, very readable, and has a depth that can be missed in the light of that reading experience. It’s worth your time.

—David Murphy holds a Masters of Finance from the University of Minnesota.