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Industries that lose jobs due to automation cause job growth in more slowly automating industries: http://www.vox.com/new-money/2016/10/24/13327014/productivit

Industries that lose jobs due to automation cause job growth in more slowly automating industries: http://www.vox.com/new-money/2016/10/24/13327014/productivity-paradox-innovation-growth http://www.vox.com/new-money/2016/10/24/13327014/productivit... This has been the pattern for over 200 years of labour-saving automation: http://www.economicshelp.org/blog/6717/economics/the-luddite-fallacy/ http://www.economicshelp.org/blog/6717/economics/the-luddite...

djschnei 9y ago
Unfortunately, this myopia is and will always be perennial. I think in large part it's a misunderstanding of what the goal of an economy should be; many think it's maximum employment - it's not. Maximum employment is a side effect of a healthy economy, not the goal. The goal of an economy should be maximum productivity. When maximum employment is the priority, you tend to get less of everything. It's a subtle difference, but with it comes an unbelievably strong basis for misunderstanding. Would the economy be better off if we replaced excavation equipment with spoons? Surely this would create tons of excavation jobs, but would the effect ripple outwards past that specific job type? Would it be a positive ripple or a negative ripple? It's a ridiculous hypothetical, but accurately illustrates the point.
- jstanley 9y ago
  "The economy" shouldn't have a goal. The economy consists of individuals, who all have individual goals, which may or may not align with each other. But "the economy" as a whole should have no goal. It's like asking what the goal of "nature" should be. Nature consists of individuals who have their own goals, but nature has no goals of its own.
  - djschnei 9y ago
    Economic systems and theories are absolutely devised with goals. Entirely agree the economy is nothing but individuals, that's why capitalism is so ingenious, but that doesn't mean the system doesn't have a goal.
    - thesagan 9y ago
      The goal is diffused and spread out among ~8 billion people. Theorizing goals is fun, but it doesn't make it a goal anymore than Darwin made "survival" a goal for nature (or life, more narrowly); which isn't always true. (Some species self-sacrifice for reasons outside of self/individual preservation.) There may be a prevailing ideology, I'll admit. In the west, and now most of the world, it seems to be material wealth, as measured in exchange tokens. In the future, in some places, maybe other forms of well-being will come to dominate, perhaps measured in stranger tokens.
      - djschnei 9y ago
        We're getting caught up in pretty meaningless semantics here... but maybe your conflating natural individual self interest with the goal of an economic system? They are different things. Capitalism (the economic system) looks to channel individual self interest towards it's most mutually beneficial ends. It looks to maximize productive output of the overall system by channeling natural individual tendencies.
        thesagan 9y ago
        Econ and politics is rife with semantics, and they're very important, and sometimes central to the conversation. Either way, I think you're the one making the claims that need substantiation. Years of studying econ hasn't provided me clear evidence that upholds the idea that "economies have goals" other than "economies tend to grow in material wealth" – and even that has subtleties too many to thoroughly discuss on an internet forum.
        djschnei 9y ago
        Economic systems have goals. They're systems devised by men. They don't just throw spaghetti against the wall and call it an economic system. Socialism was designed to accomplish some set of goals, capitalism was designed to accomplish some set of goals. Not really sure how this is an argument...
- s73ver 9y ago
  Philosophy discussion aside, what is going to be done for those displaced to automation? The whole "what is the goal of the economy" talk is nice, but at the end of the day, there are millions of people who are going to be unable to feed and house their families because of automation. What is going to be done for them?
  - djschnei 9y ago
    Are you asking what can be centrally designed/planned to soften the blow of technological progress for those whose professions become obsolete? To that question, I would say nothing. And this isn't from a philosophical POV; it's from a very pragmatic/logical POV (which admittedly seems cold at first glance). Pragmatically, these kinds of questions have to be weighed by net-harm vs net-good. By stifling innovation or subsidizing bad ways of doing things you are choosing a (relatively) small amount of good (preserving some obsolete job so that people don't lose those specific jobs) over the much larger net-good that increase economic output provides for the entire system. If you have an open mind; I would suggest reading the chapter "The Curse of Machinery" from Henry Hazlitt's 1946 work "Economics in One Lesson". It can be read here for free: https://fee.org/articles/the-curse-of-machinery/ https://fee.org/articles/the-curse-of-machinery/ Would never suggest this will change your world, but it might help you understand the opposing POV.
    - s73ver 9y ago
      I'm going to have to completely disagree with the idea that we can't do anything to soften the blow. And note that nowhere have I called for progress to be halted or regulations preserving "obsolete" jobs to be enacted. However, we must do something to help these people either retrain or otherwise supporting their families. In terms of net-good vs net-bad, I would consider it to be enormously net-bad to simply cast these people aside, and not help them at all.
      - djschnei 9y ago
        Not being able to centrally plan/organize the economy to help those "victimized" by progress is very different than not being able to help at all. What do you propose that wouldn't act as a handicap on the economy overall? Also, interested if you took a look at that chapter I posted. Interested in your take.
ThomPete 9y ago
simply not true. The number of new jobs created decade over decade have gone down and the politicans have redefined what constitute a job, most today are temporary. You are ironically making the fallacy of the luddite falkacy. Jobs have been created in the world, not in the west. Unemployment numbers are based on temp jobs no real jobs.
- Jabanga 9y ago
  People work fewer hours but the aggregate demand for labour per capita has increased substantially, meaning the average person earns far more per day than people in the past, working fewer hours per day. If people chose to work more hours, the hourly wage would decrease somewhat, but total wages paid out would still increase, since it would contribute to higher levels of production. In other words, people work less because they choose to work less, not because there is less demand for their labour. There is objectively more aggregate demand, as measured by constant dollars spent on it, for labour per capita.
petra 9y ago
That's not accurate. People in the past worked longer hours,with less vacations, didn't have longer education or retirement etc. So they've worked less. Further more , what we do know from history is that technology does cause transition periods with heavy unemployment and other forms of suffering. But: in the past ,things happened much slower. The term "the industrial revolution", for example, was created after the fact ,because people of that time just seen a slow change, both in time and geography. And yet, all that suffering, both directly(unemployment, poverty) and indirectly(world wars). But it seems that today ,things are happening fast. So even if the only problem is handling the transition periods ,it could be a really big problem.
- Jabanga 9y ago
  >People in the past worked longer hours,with less vacations, didn't have longer education or retirement etc. So they've worked less. The per capita aggregate demand for labour has massively increased since 200 years ago. If you divide the amount of wages paid out in the aggregate by the number of people, you see it has increased something on the order of 20X. People work less because they have less need to work, as a result of much higher levels of wages/wealth. If they so chose, there would be plenty of work they could do, and that there is much higher levels of demand (as measured by constant dollars paid out) for it than there was in the past. >Further more , what we do know from history is that technology does cause transition periods with heavy unemployment and other forms of suffering. Technology has not historically caused transition periods with heavy unemployment.

djschnei 9y ago

Unfortunately, this myopia is and will always be perennial. I think in large part it's a misunderstanding of what the goal of an economy should be; many think it's maximum employment - it's not. Maximum employment is a side effect of a healthy economy, not the goal. The goal of an economy should be maximum productivity. When maximum employment is the priority, you tend to get less of everything. It's a subtle difference, but with it comes an unbelievably strong basis for misunderstanding. Would the economy be better off if we replaced excavation equipment with spoons? Surely this would create tons of excavation jobs, but would the effect ripple outwards past that specific job type? Would it be a positive ripple or a negative ripple? It's a ridiculous hypothetical, but accurately illustrates the point.

jstanley 9y ago
"The economy" shouldn't have a goal. The economy consists of individuals, who all have individual goals, which may or may not align with each other. But "the economy" as a whole should have no goal. It's like asking what the goal of "nature" should be. Nature consists of individuals who have their own goals, but nature has no goals of its own.
- djschnei 9y ago
  Economic systems and theories are absolutely devised with goals. Entirely agree the economy is nothing but individuals, that's why capitalism is so ingenious, but that doesn't mean the system doesn't have a goal.
  - thesagan 9y ago
    The goal is diffused and spread out among ~8 billion people. Theorizing goals is fun, but it doesn't make it a goal anymore than Darwin made "survival" a goal for nature (or life, more narrowly); which isn't always true. (Some species self-sacrifice for reasons outside of self/individual preservation.) There may be a prevailing ideology, I'll admit. In the west, and now most of the world, it seems to be material wealth, as measured in exchange tokens. In the future, in some places, maybe other forms of well-being will come to dominate, perhaps measured in stranger tokens.
    - djschnei 9y ago
      We're getting caught up in pretty meaningless semantics here... but maybe your conflating natural individual self interest with the goal of an economic system? They are different things. Capitalism (the economic system) looks to channel individual self interest towards it's most mutually beneficial ends. It looks to maximize productive output of the overall system by channeling natural individual tendencies.
      - thesagan 9y ago
        Econ and politics is rife with semantics, and they're very important, and sometimes central to the conversation. Either way, I think you're the one making the claims that need substantiation. Years of studying econ hasn't provided me clear evidence that upholds the idea that "economies have goals" other than "economies tend to grow in material wealth" – and even that has subtleties too many to thoroughly discuss on an internet forum.
        djschnei 9y ago
        Economic systems have goals. They're systems devised by men. They don't just throw spaghetti against the wall and call it an economic system. Socialism was designed to accomplish some set of goals, capitalism was designed to accomplish some set of goals. Not really sure how this is an argument...
s73ver 9y ago
Philosophy discussion aside, what is going to be done for those displaced to automation? The whole "what is the goal of the economy" talk is nice, but at the end of the day, there are millions of people who are going to be unable to feed and house their families because of automation. What is going to be done for them?
- djschnei 9y ago
  Are you asking what can be centrally designed/planned to soften the blow of technological progress for those whose professions become obsolete? To that question, I would say nothing. And this isn't from a philosophical POV; it's from a very pragmatic/logical POV (which admittedly seems cold at first glance). Pragmatically, these kinds of questions have to be weighed by net-harm vs net-good. By stifling innovation or subsidizing bad ways of doing things you are choosing a (relatively) small amount of good (preserving some obsolete job so that people don't lose those specific jobs) over the much larger net-good that increase economic output provides for the entire system. If you have an open mind; I would suggest reading the chapter "The Curse of Machinery" from Henry Hazlitt's 1946 work "Economics in One Lesson". It can be read here for free: https://fee.org/articles/the-curse-of-machinery/ https://fee.org/articles/the-curse-of-machinery/ Would never suggest this will change your world, but it might help you understand the opposing POV.
  - s73ver 9y ago
    I'm going to have to completely disagree with the idea that we can't do anything to soften the blow. And note that nowhere have I called for progress to be halted or regulations preserving "obsolete" jobs to be enacted. However, we must do something to help these people either retrain or otherwise supporting their families. In terms of net-good vs net-bad, I would consider it to be enormously net-bad to simply cast these people aside, and not help them at all.
    - djschnei 9y ago
      Not being able to centrally plan/organize the economy to help those "victimized" by progress is very different than not being able to help at all. What do you propose that wouldn't act as a handicap on the economy overall? Also, interested if you took a look at that chapter I posted. Interested in your take.

ThomPete 9y ago

simply not true. The number of new jobs created decade over decade have gone down and the politicans have redefined what constitute a job, most today are temporary. You are ironically making the fallacy of the luddite falkacy. Jobs have been created in the world, not in the west. Unemployment numbers are based on temp jobs no real jobs.

Jabanga 9y ago
People work fewer hours but the aggregate demand for labour per capita has increased substantially, meaning the average person earns far more per day than people in the past, working fewer hours per day. If people chose to work more hours, the hourly wage would decrease somewhat, but total wages paid out would still increase, since it would contribute to higher levels of production. In other words, people work less because they choose to work less, not because there is less demand for their labour. There is objectively more aggregate demand, as measured by constant dollars spent on it, for labour per capita.

petra 9y ago

That's not accurate. People in the past worked longer hours,with less vacations, didn't have longer education or retirement etc. So they've worked less. Further more , what we do know from history is that technology does cause transition periods with heavy unemployment and other forms of suffering. But: in the past ,things happened much slower. The term "the industrial revolution", for example, was created after the fact ,because people of that time just seen a slow change, both in time and geography. And yet, all that suffering, both directly(unemployment, poverty) and indirectly(world wars). But it seems that today ,things are happening fast. So even if the only problem is handling the transition periods ,it could be a really big problem.

Jabanga 9y ago
>People in the past worked longer hours,with less vacations, didn't have longer education or retirement etc. So they've worked less. The per capita aggregate demand for labour has massively increased since 200 years ago. If you divide the amount of wages paid out in the aggregate by the number of people, you see it has increased something on the order of 20X. People work less because they have less need to work, as a result of much higher levels of wages/wealth. If they so chose, there would be plenty of work they could do, and that there is much higher levels of demand (as measured by constant dollars paid out) for it than there was in the past. >Further more , what we do know from history is that technology does cause transition periods with heavy unemployment and other forms of suffering. Technology has not historically caused transition periods with heavy unemployment.