19 ms·

Comparative advantage is exactly why so many people will loose their jobs. If a small number of people, with the aid of machines, can do the equivalent work of

by evv 8y ago

Comparative advantage is exactly why so many people will loose their jobs. If a small number of people, with the aid of machines, can do the equivalent work of thousands of workers, how will the free market support the higher cost of human labour in comparison to the robots? Its not that people will have nothing to do. But for a huge number of people, there will be no way to get paid as much as it costs them to live.

greggyb 8y ago
Comparative advantage is an economic theory that says there is still gain from trade between asymmetric producers. It is possible to have an absolute advantage in production of all goods, but still gain from trading with your inferior partner. This is based on another of the foundational concepts in economics, that of opportunity cost. Economics is debate-ably a science, but it is certainly a mature field of study. Much like other mature fields of study and technical fields, it contains jargon. Economics suffers exceptionally from the challenge of its jargon sounding like vernacular language. You are not using comparative advantage correctly. The wikipedia article is relatively short and clear.[0] That being said, your argument seems to be "efficiencies in production will drive the prices of goods down" and "humans will earn less money." There is a pretty big jump to "humans will not earn enough to pay the prices of the (now cheaper) goods they require to live." Let's engage on that argument. Is it a fair (though obviously simplified) statement of your position? What leads you to believe that wages will fall to a greater extent than prices? [0] https://en.wikipedia.org/wiki/Comparative_advantage https://en.wikipedia.org/wiki/Comparative_advantage
- evv 8y ago
  Late response here. Yeah I clearly missed the reference to the economics term, but that makes sense. To respond on the main debate, my argument is not that "efficiencies in production will drive the prices of goods down" but instead that "efficiencies in production will drive the production costs of goods down". Just because it becomes cheaper to make a product, doesn't mean that the consumer price will drop the same amount. Especially if that cheaper production can only be utilized by a few companies with automation skills. The economic benefits of automation may trickle down to consumers, but will largely be taken by the few large companies capable of such automation.

by evv 8y ago

greggyb 8y ago

Comparative advantage is an economic theory that says there is still gain from trade between asymmetric producers. It is possible to have an absolute advantage in production of all goods, but still gain from trading with your inferior partner. This is based on another of the foundational concepts in economics, that of opportunity cost. Economics is debate-ably a science, but it is certainly a mature field of study. Much like other mature fields of study and technical fields, it contains jargon. Economics suffers exceptionally from the challenge of its jargon sounding like vernacular language. You are not using comparative advantage correctly. The wikipedia article is relatively short and clear.[0] That being said, your argument seems to be "efficiencies in production will drive the prices of goods down" and "humans will earn less money." There is a pretty big jump to "humans will not earn enough to pay the prices of the (now cheaper) goods they require to live." Let's engage on that argument. Is it a fair (though obviously simplified) statement of your position? What leads you to believe that wages will fall to a greater extent than prices? [0] https://en.wikipedia.org/wiki/Comparative_advantage https://en.wikipedia.org/wiki/Comparative_advantage

evv 8y ago
Late response here. Yeah I clearly missed the reference to the economics term, but that makes sense. To respond on the main debate, my argument is not that "efficiencies in production will drive the prices of goods down" but instead that "efficiencies in production will drive the production costs of goods down". Just because it becomes cheaper to make a product, doesn't mean that the consumer price will drop the same amount. Especially if that cheaper production can only be utilized by a few companies with automation skills. The economic benefits of automation may trickle down to consumers, but will largely be taken by the few large companies capable of such automation.