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I used to believe that automation will lead to greater unemployment. Now I think that two things happen: goods get cheaper which lowers the minimum amount someo

I used to believe that automation will lead to greater unemployment. Now I think that two things happen: goods get cheaper which lowers the minimum amount someone needs to earn for a job to be acceptable. People who still have a great job have more spending our. This unlocks new jobs that previously nobody would have paid for and nobody would have accepted. But both maximum price somebody would pay went up and minimum price someone wants to perform went down. Recent examples are all these delivery services and obviously Lyft and Uber, although the car services are a little more complicated since there always were taxis.

lev99 9y ago
I think there are three forces discussed here. Automation (removing work). Decreased cost good (reduced labor costs). Increased wealth (those with it spend more on goods and services). Automation's effects on the economy larger depends on the pace it is achieved. If someone released a box that replaces truck driver's tomorrow and sells it for $1000 then there will be huge disruption. If drivers are replaced with automation slowly over 30 years the impact will be less because the rest of the economy will have time to absorb the impact. Increased wealth is expanding the service industry, with petcare being a prime example. This will create more jobs, but those jobs are both at risk of being automated and might not be enough to replace automation. Decreased good costs works for some things like toothbrushes and iphones, but they don't work so well for limited resources like gold jewelry or real-estate. It might improve quality of life in some ways, but it cannot help with everything.
zanny 9y ago
Except it doesn't matter if general goods and services get cheaper if life necessities like healthcare and residence have their costs ballooning out of control. That $8 minimum wage job in ten years might be able to buy you twice as many trinkets at the same price but that doesn't mean anything if you have no where to live for less than $3,000 a month in rent. Thats not to say that you cannot make housing and healthcare dramatically cheaper and more efficient, but we simply are not doing it, and there doesn't seem to be nearly enough momentum to see change happen in that regard. Lives rarely get better without a good protest, but there is no uniform movement with only big wig opposition to fixing zoning laws or socializing medicine. Its all working class vs working class infighting between haves and have nots.

lev99 9y ago

I think there are three forces discussed here. Automation (removing work). Decreased cost good (reduced labor costs). Increased wealth (those with it spend more on goods and services). Automation's effects on the economy larger depends on the pace it is achieved. If someone released a box that replaces truck driver's tomorrow and sells it for $1000 then there will be huge disruption. If drivers are replaced with automation slowly over 30 years the impact will be less because the rest of the economy will have time to absorb the impact. Increased wealth is expanding the service industry, with petcare being a prime example. This will create more jobs, but those jobs are both at risk of being automated and might not be enough to replace automation. Decreased good costs works for some things like toothbrushes and iphones, but they don't work so well for limited resources like gold jewelry or real-estate. It might improve quality of life in some ways, but it cannot help with everything.

zanny 9y ago

Except it doesn't matter if general goods and services get cheaper if life necessities like healthcare and residence have their costs ballooning out of control. That $8 minimum wage job in ten years might be able to buy you twice as many trinkets at the same price but that doesn't mean anything if you have no where to live for less than $3,000 a month in rent. Thats not to say that you cannot make housing and healthcare dramatically cheaper and more efficient, but we simply are not doing it, and there doesn't seem to be nearly enough momentum to see change happen in that regard. Lives rarely get better without a good protest, but there is no uniform movement with only big wig opposition to fixing zoning laws or socializing medicine. Its all working class vs working class infighting between haves and have nots.