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It's a fallacy that an increase in a workers productivity due to better technology or innovation on the part of someone else should result in an equal share i

by codexb 3y ago

It's a fallacy that an increase in a workers productivity due to better technology or innovation *on the part of someone else* should result in an equal share in the profits of that increased productivity. If I have a factory that makes widgets, and I pay a skilled worker to laboriously craft one widget at a time by hand, and then I invent a machine that allows unskilled workers to make tens of widgets at a time, why would those workers see any increase in pay at all? In fact, their pay would likely go down, because now I can hire unskilled labor instead of skilled craftsman. The benefits of technology will always be exponentially unequal.

danzig13 3y ago
Why isn’t the craftsman a good candidate for overseeing/maintaining the machine and/or overseeing unskilled labor? If he becomes skilled in that regard, you will have to pay well enough to retain his services. It is stupid too throw good, reliable people away especially in manufacturing.
ceejayoz 3y ago
That'd be great and all, but it's largely not the inventors making the money, either. Did an early investor in Facebook do more work than an early investor in Pets.com?
- nickff 3y ago
  The investor in Facebook, and the one in Pets.com could very well be the same person, making a very mediocre return. If, on the other hand, the investor manages to only invest in successful enterprises, thereby enabling a huge amount of consumer surplus, they should probably be rewarded (thus permitted and enabled to support even more consumer surplus in the future).
- darigo 3y ago
  I agree with the point you're making but I think this is a less than ideal example: >Did an early investor in Facebook do more work than an early investor in Pets.com? It's quite possible that an investor who does more research, spends more time networking with smart young people, etc, would have to do more work in order to invest in better things. And even if not, meritocracy means rewarding the quality of work, not just the quantity. Making smart investments should pay better than making dumb ones, even if it's not more work.
idontpost 3y ago
[dead]
AndrewKemendo 3y ago
You’d simply give them the same pay and reduce their hours so they can live a better life while your margins still increase. That’s what technology is supposed to do, make less labor for everyone not entrench power dynamics So yeah I guess the answer is just so obviously singular that capital should be the primary beneficiary from technology
- bloppe 3y ago
  Capitalism should incentivize efficient allocation of resources. If a job becomes easier or less in-demand, it should see a pay decrease. It's not the capitalist's job to pay above-market wages just because "they should". It's the government's job to redistribute wealth to compensate for unhealthy concentration.
  - ceejayoz 3y ago
    > Capitalism should incentivize efficient allocation of resources. Capitalism needs workers who can afford to buy the products, too.
    - bloppe 3y ago
      Perhaps even using the word capitalism has become unhelpful since it's so charged. I think we're basically agreeing with each other. I just think this particular responsibility falls on the government rather than individual employers.
- fragmede 3y ago
  > give them the same pay and reduce their hours so they can live a better life while your margins still increase. Not that I disagree that would be nice, but what's the incentive to the company owner to do that under capitalism? As a purely business decision, you'd fire the highly paid experts and replace them with lower-paid less-expert labor. Which is exactly what's been going on with layoffs in the tech sector, just without the magic productivity multiplying machine, so this is not theoretical.
AlexandrB 3y ago
This is the "let them eat cake" of automation and if it becomes widespread it might end the same way.
xeckr 3y ago
By inventing such a machine you have created a bunch of new high-value jobs.
corry 3y ago
It's a hard truth that capital garners the majority of the additional profits from labor efficiency increases. I struggle with this. Yes, it seems almost a law of nature that fitness begets more fitness. But surely we can structure society to be above mere nature? So what's the mechanism to protect against it? Market forces don't seem to work too well. Corporate taxes would/should work, if our government weren't also co-opted by capital? Unions? UBI?
- bloppe 3y ago
  Well-designed socialism, possibly including UBI, is the correct answer. Market forces are super useful and important, the government just needs to make sure competition is fair.
- Vicinity9635 3y ago
  [dead]
akgoel 3y ago
I own a machine shop in Houston. In 1980, our best machinists were making $20-$25 an hour using manual machines. In 2019 (pre-pandemic), they were still making $25 an hour while being much more productive on CNC machines. Forget real wages - they were making the same nominal wages after 40 years.

It's a fallacy that an increase in a workers productivity due to better technology or innovation *on the part of someone else* should result in an equal share i

by codexb 3y ago

danzig13 3y ago

Why isn’t the craftsman a good candidate for overseeing/maintaining the machine and/or overseeing unskilled labor? If he becomes skilled in that regard, you will have to pay well enough to retain his services. It is stupid too throw good, reliable people away especially in manufacturing.

ceejayoz 3y ago

That'd be great and all, but it's largely not the inventors making the money, either. Did an early investor in Facebook do more work than an early investor in Pets.com?

nickff 3y ago
The investor in Facebook, and the one in Pets.com could very well be the same person, making a very mediocre return. If, on the other hand, the investor manages to only invest in successful enterprises, thereby enabling a huge amount of consumer surplus, they should probably be rewarded (thus permitted and enabled to support even more consumer surplus in the future).
darigo 3y ago
I agree with the point you're making but I think this is a less than ideal example: >Did an early investor in Facebook do more work than an early investor in Pets.com? It's quite possible that an investor who does more research, spends more time networking with smart young people, etc, would have to do more work in order to invest in better things. And even if not, meritocracy means rewarding the quality of work, not just the quantity. Making smart investments should pay better than making dumb ones, even if it's not more work.

idontpost 3y ago

[dead]

AndrewKemendo 3y ago

You’d simply give them the same pay and reduce their hours so they can live a better life while your margins still increase. That’s what technology is supposed to do, make less labor for everyone not entrench power dynamics So yeah I guess the answer is just so obviously singular that capital should be the primary beneficiary from technology

bloppe 3y ago
Capitalism should incentivize efficient allocation of resources. If a job becomes easier or less in-demand, it should see a pay decrease. It's not the capitalist's job to pay above-market wages just because "they should". It's the government's job to redistribute wealth to compensate for unhealthy concentration.
- ceejayoz 3y ago
  > Capitalism should incentivize efficient allocation of resources. Capitalism needs workers who can afford to buy the products, too.
  - bloppe 3y ago
    Perhaps even using the word capitalism has become unhelpful since it's so charged. I think we're basically agreeing with each other. I just think this particular responsibility falls on the government rather than individual employers.
fragmede 3y ago
> give them the same pay and reduce their hours so they can live a better life while your margins still increase. Not that I disagree that would be nice, but what's the incentive to the company owner to do that under capitalism? As a purely business decision, you'd fire the highly paid experts and replace them with lower-paid less-expert labor. Which is exactly what's been going on with layoffs in the tech sector, just without the magic productivity multiplying machine, so this is not theoretical.

AlexandrB 3y ago

This is the "let them eat cake" of automation and if it becomes widespread it might end the same way.

xeckr 3y ago

By inventing such a machine you have created a bunch of new high-value jobs.

corry 3y ago

It's a hard truth that capital garners the majority of the additional profits from labor efficiency increases. I struggle with this. Yes, it seems almost a law of nature that fitness begets more fitness. But surely we can structure society to be above mere nature? So what's the mechanism to protect against it? Market forces don't seem to work too well. Corporate taxes would/should work, if our government weren't also co-opted by capital? Unions? UBI?

bloppe 3y ago
Well-designed socialism, possibly including UBI, is the correct answer. Market forces are super useful and important, the government just needs to make sure competition is fair.
Vicinity9635 3y ago
[dead]

akgoel 3y ago

I own a machine shop in Houston. In 1980, our best machinists were making $20-$25 an hour using manual machines. In 2019 (pre-pandemic), they were still making $25 an hour while being much more productive on CNC machines. Forget real wages - they were making the same nominal wages after 40 years.