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This is clear to anyone with freshman macroeconomics - The Cobb-Douglas function for factor productivity: Y = A * L^β * K^α Value of your work depends on how
by swyx 4y ago
This is clear to anyone with freshman macroeconomics - The Cobb-Douglas function for factor productivity:
Y = A * L^β * K^α
Value of your work depends on how well you wield capital (K) and labor (L).
Code, Cloud and AI have massively improved α while β is at generational lows.
- tareqak 4y agoThank you for mentioning something new to me: https://en.wikipedia.org/wiki/Cobb–Douglas_production_function https://en.wikipedia.org/wiki/Cobb–Douglas_production_functi... .
- galangalalgol 4y agoWhy do you think the output elasticity for labor is low? Is it a case of having to work a certain number of hours to get medical care? Is it the price of medical care? It seems like modern tools and automation would help it be higher?