5 ms·

I think the only consistent and reasonable measure for productivity of labor is how much the economy is willing to pay for the labor[1]. So if the society is wi

I think the only consistent and reasonable measure for productivity of labor is how much the economy is willing to pay for the labor[1]. So if the society is willing to pay nurses n times higher salaries than 20 years before, the value of nurses work has become n times higher, and the productivity has increased n-fold. (minus inflation). And the baumol effect vanishes as a puff of smoke into air. [1] But surely a worker creating only one thingie at the same time than other produce five thingies must be less productive, you say? Well, if the first one is able to sell his thingies at more than 5 times higher price than others, quite obviously s/he is more productive than the others.

nilsbunger 4y ago
This isn’t just about productivity of labor, it’s about productivity in terms of end result. That kind of or productivity is deflationary, not inflationary. Eg a TV costs 10% of what it did 20 years ago. Fewer person-hours of work are involved in making one TV. Less of the average home budget goes to TVs than it used to, even while people are buying better tvs. That’s a massive productivity increase in the lingo of economics. You could replace TV with solar panels, cars, computers, etc. Less human involvement per good produced => productivity increase.
- beefield 4y ago
  So because one set of chinese are able to make bunch of counterfeit casio watches way cheaper than another set of chinese can make apple watches, the first one are more productive because both make watches that show time? Maybe there is a reason why another watch or another nursing service or another tv (at another time) is more expensive? Maybe the reason is that in the more expensive case they produce more value i.e are more productive? By the way, just started wondering why nobody is worried about the atrocious productivity development of CEOs over the last decades? Should shareholders maybe hire some consultants to advice the CEOs how they could make their work more efficiently that they could become cheaper?
  - deleted 4y ago
    [deleted]
LudwigNagasena 4y ago
Why do you think it is inconsistent and unreasonable to choose a measure of productivity that says y=5x is more productive than y=x in terms of real output of y given real input of x? > So if the society is willing to pay nurses n times higher salaries than 20 years before, the value of nurses work has become n times higher, and the productivity has increased n-fold. (minus inflation). How do you disentangle value and inflation? I think that makes your definition incoherent as you just loop back to real output and real productivity to measure those things.
hgsgm 4y ago
So if a billion robot nurses suddenly appear, doing the same work as human nurses, driving prices down due to competitive and lower costs for the robots, how has value of the product decreased?
- NoZebra120vClip 4y ago
  Robot nurses, huh? How do you measure (and compensate workers for) compassion? Making ethical decisions? Maintaining confidentiality? Acting on a combination of training and instinct? I mean, okay, we can conceive of robot nurses who do the latter, but how does a robot nurse demonstrate compassion and empathy for patients? I think that stuff is priceless.
- LeonB 4y ago
  Because “value” in the economic sense is not synonymous with “value” in the ethical sense and neither is it a complete overlap with “value” in the way we use it in everyday speech. In economics value is about choice and indifference. If you have two options and you are indifferent between them they have the same value. Everything about value in economics flows from there. It’s a very useful concept. But it’s not the same as “value” that a philosopher, a poet, or anyone else might talk about. Similarly “utility” in economics is fairly much equivalent to value in economics — but “utility” in economics doesn’t quite map to the common term “useful”.

nilsbunger 4y ago

This isn’t just about productivity of labor, it’s about productivity in terms of end result. That kind of or productivity is deflationary, not inflationary. Eg a TV costs 10% of what it did 20 years ago. Fewer person-hours of work are involved in making one TV. Less of the average home budget goes to TVs than it used to, even while people are buying better tvs. That’s a massive productivity increase in the lingo of economics. You could replace TV with solar panels, cars, computers, etc. Less human involvement per good produced => productivity increase.

beefield 4y ago
So because one set of chinese are able to make bunch of counterfeit casio watches way cheaper than another set of chinese can make apple watches, the first one are more productive because both make watches that show time? Maybe there is a reason why another watch or another nursing service or another tv (at another time) is more expensive? Maybe the reason is that in the more expensive case they produce more value i.e are more productive? By the way, just started wondering why nobody is worried about the atrocious productivity development of CEOs over the last decades? Should shareholders maybe hire some consultants to advice the CEOs how they could make their work more efficiently that they could become cheaper?
- deleted 4y ago
  [deleted]

LudwigNagasena 4y ago

Why do you think it is inconsistent and unreasonable to choose a measure of productivity that says y=5x is more productive than y=x in terms of real output of y given real input of x? > So if the society is willing to pay nurses n times higher salaries than 20 years before, the value of nurses work has become n times higher, and the productivity has increased n-fold. (minus inflation). How do you disentangle value and inflation? I think that makes your definition incoherent as you just loop back to real output and real productivity to measure those things.

hgsgm 4y ago

So if a billion robot nurses suddenly appear, doing the same work as human nurses, driving prices down due to competitive and lower costs for the robots, how has value of the product decreased?

NoZebra120vClip 4y ago
Robot nurses, huh? How do you measure (and compensate workers for) compassion? Making ethical decisions? Maintaining confidentiality? Acting on a combination of training and instinct? I mean, okay, we can conceive of robot nurses who do the latter, but how does a robot nurse demonstrate compassion and empathy for patients? I think that stuff is priceless.
LeonB 4y ago
Because “value” in the economic sense is not synonymous with “value” in the ethical sense and neither is it a complete overlap with “value” in the way we use it in everyday speech. In economics value is about choice and indifference. If you have two options and you are indifferent between them they have the same value. Everything about value in economics flows from there. It’s a very useful concept. But it’s not the same as “value” that a philosopher, a poet, or anyone else might talk about. Similarly “utility” in economics is fairly much equivalent to value in economics — but “utility” in economics doesn’t quite map to the common term “useful”.