Over on the Steve Jackson Games fora, Sean Punch (“Dr. Kromm”) offered an interesting idea (Cost to cast spells as a service - Page 3 - Steve Jackson Games Forums): Mages in what is now a classic fantasy adventure setting tend to be viewed with jealousy and/or fear (I would probably say “envy” rather than “jealousy”); and since this means that ordinary people are often hostile to them, they are likely to avoid close contact with the general population, and thus to be viewed as aloof and/or power-hungry. As a result, they aren’t likely to practice magic in a way that transforms everyday life (in GURPS terms, raises the Tech Level): their personal motives are more about self-protection, and they probably don’t care about uplifting a society that fears, mistrusts, and persecutes them.
I found myself thinking of an analogy: People who own capital—for example, Jewish moneylenders in the Middle Ages. They’re subject to envy for their wealth (or imagined wealth); they have an incentive to isolate themselves for protection against day to day violence and harassment; and that isolation means that they’re easily targeted by the proverbial angry villagers. So their capital doesn’t much go to productive enterprises; more of it goes to nobles whose essential business model is more like extortion. Once you have fairly reliable protection for property and contracts, it becomes easier for accumulated wealth to fund “improvements.”
It hit me that the model of mages as isolated, reclusive, and self-protecting is actually well represented by Ars Magica, where mages live in fairly isolated communities; or at a higher power level, by Mage: The Sorcerers’ Crusade, which has a founding legend of the common people rising up to destroy the aloof and power-hungry wizards.
On the other hand, if you come up with a legal framework in which (many forms of) magic [are] legally protected, you may move toward a society where spells and enchantments are available for everyday use, and where magic does raise the Tech Level, in the style of “Magic, Inc.” or Operation Chaos or The Case of the Toxic Spell Dump. At that point your society ceases to be low-tech and becomes different-tech, and it’s no longer going to look “medieval.” Instead of having “improvers” who practice crop rotation and selective breeding, you get professional mages who cast spells of yield increase and pest control and weather manipulation and the like, for example.
The fiction I cited tends to assume that the magically advanced society looks very much like ours, but with spirits and magical forces taking the place of electrons and energy. But likely the differences would be greater than that. I think it might be hard to envision a fully develop high-tech magical society, but fiction or games set in the days of transition might be an interesting project.