Technology improves productivity, as the technology improves so does the economic capacity per individual (as seen in Per Capita GDP or Income). Economic level is the metric used to measure the effect of a technology. If the technology fails to make an economic impact, then the advance is not significant.
We can build a bunch of wonderful gadgets in this day and age, but not all these gadget transform the way we live or do business. If I just look at the Gadget purchases I've made in the computer advances from the Netbook to the Tablet, productivity increased but not at 100% levels.
the nice thing about economic level is that, you can replace technology with MAGIC, Psionics, Biotech, etc.. The GM or World Builder just looks at an end result, the macro, and decides what the micro is going to be like because of the details they are aware of.
Take for instance the present economies of the world, and telescope from the Macro to Micro because of current events and economic theory. I listen a lot about Chinese, Philippines and US economic news so the Picture it paints on the abstraction of Economics helps detail eras advance and ancient. It also helps that I had about 100 hours of Chinese and Philippine history and economics; other than the easily available western economics and history.
TL:DR - Economic Level helps draw brush strokes of technology level... without stepping on the toes of other Game Systems and Copyright, while being more Sciencey and Simulationist.
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