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Except the incentives are unexpected. Back when labor unions were strong then labor was getting 75% of all productivity gains. In Belgium, from 1950 to 1970, la
by lkrubner 4y ago
Except the incentives are unexpected. Back when labor unions were strong then labor was getting 75% of all productivity gains. In Belgium, from 1950 to 1970, labor got 110% of all productivity gains (so national income shifted from capital to labor). But after 1973, in the USA, capital gets 90% (and then later 100%), of all productivity gains. Given such a huge reward, you would think capital would then want to maximize productivity gains. It is odd that when capital finally got all of the gains from productivity, productivity growth slowed.
- bryanrasmussen 4y agomy suggestion is that productivity growth is in the hands of the people who must be productive. As they lost incentives they became less productive, but because the companies provided productivity boosters they were able to stay at the same level of productivity. In order for capital to increase productivity if this were correct they would have to give the shares of the rewards to the labor. on edit: it seems weird to say we gave them all these tools to increase productivity, and they didn't increase productivity, but not note at the same time we removed rewards for increased productivity.