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In his book “Work - A Deep History, from the Stone Age to the Age of Robots” James Suzman explains that recurrently; a society’s agricultural output was diluted due to population growth, (this is known as a “Malthusian trap”)

My question is: what is the name for a similar effect but related to technology? For example, the first few people that had a car were able to move farther and faster… But as more people had cars, everyone moved farther away, so the “output was diluted” because it just takes the same amount of time to go visit people/work.

The same can be said of airplanes, smartphones, etc.

Can the above be described as a “Malthusian trap” too? Has the above been studied?

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  • $\begingroup$ "society’s agricultural output was diluted" In what sense are you using the word "diluted" here, what do you mean by it? $\endgroup$
    – Giskard
    Feb 1 at 12:56

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Can the above be described as a “Malthusian trap” too? Has the above been studied?

No, it cannot be described as Malthusian trap too. Technology does not dilute output but augments it. Technology is the solution to Malthusian trap.

The argument for Malthusian trap is as follows (Malthus 1798, An Essay on the Principle of Population), if you assume no technological innovation (which wasn't very unreasonable in 16 century), then marginal product product per plot of land would decline. This is because the best land is always used first, so as you add more people to a mix the output per person declines. This is what is meant by dilution of output.

To see it consider following example, lets say agricultural output $Y$ is given as follows: $Y=L^{0.5}K^{0.5}$ where $L$ is labor which assuming that everyone puts the same hours we can just denote to be the number of people country has. Capital $K$ will be normalized to 1 so we can ignore it for sake of simplicity.

If country has 100 people the output will be; $Y= 100^{0.5}= 10$ so output per capita (per person) is $10/100=0.1$. If country has 400 people then the output will be; $Y= 400^{0.5}= 20$ and so output per capita is $20/400=0.05$. This is what the author means when he talks about the "dilution of output".

However, technology, especially transportation technology augments output. It is universally agreed among economists that advances in transportation and communication enable more efficient production. These technologies enable faster flow of commerce, allow for more rapid responses to demand, communication technology allows for easier dissemination of other technology. This is why virtually every study shows positive effects of infrastructure (roads, ports, airports, cell towers etc) on economic growth. Thus technology enhances output, it does not matter if this production is spread over wider area, since what matters is output per person. Hence, technology is literally the solution to Malthusian trap.

To continue the example above, now we would multiply our production function by technology factor $A$. If the technology $A$ increases (cars, tractors, combines etc are invented) from lets say 1 to 10, then despite the increase in population we go from $0.1$ output per person to $Y=10 \cdot 400^{0.5}=200$ so output per person would be $200/400=0.5$ which is more than before despite higher population. Hence technology does not dilute output but concentrates it.

The only way how technology could "dilute the output" would be if the technology somehow harms our productive capacity. For example, some people argue that too much screen time causes depression, I am not a psychologist so I do not know if the claim is true, but if we as a thought experiment assume it to be true, then IT technology has not just positive effect on output but also negative effect on output through lower production when workers are depressed and maybe work less as a result. When it comes to IT, the positive effects on output clearly dominate, since empirical studies show positive effects of IT on economic growth (e.g. see Salahuddin & Gow 2016), but you might be able to perhaps find some other technology where such negative effects dominate. Nonetheless, overall technology augments/concentrates output per person, not dilute it. This is well accepted in the economic growth literature (eg see graduate level textbooks like Acemoglu Introduction to Modern Economic Growth for an overview of such literature).

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    $\begingroup$ >> The only way how technology could "dilute the output" would be if the technology somehow harms our productive capacity. << OP included a clear example where people moved to the suburbs due to affordability of cars, increasing travel time. It is not the produced good that technology harms, but something related. See also Jevons paradox. $\endgroup$
    – Giskard
    Feb 1 at 12:59
  • $\begingroup$ @Giskard well the point is it is not Malthusian trap $\endgroup$
    – 1muflon1
    Feb 1 at 13:03
  • $\begingroup$ For sure, because the "Malthusian trap" is about exponential population growth outpacing linear food production. Do you really need to write 6 paragraphs to say this? $\endgroup$
    – Giskard
    Feb 1 at 13:20
  • $\begingroup$ @Giskard well first 3 paragraphs try to clarify what Malthusian trap is. Also, I understand that OP was not necessarily just talking about agriculture but output more generally, but the point is that IT does not really dilute output in Malthuesque way. $\endgroup$
    – 1muflon1
    Feb 1 at 13:54
  • $\begingroup$ Hmm, I asked the same thing from the OP, maybe you can explain it to me: what does it mean to "dilute output in Malthuesque way"? Seems like everyone has a pretty exact idea about this but me! (I know who Malthus was, I just don't have a precise understanding of this sentence.) $\endgroup$
    – Giskard
    Feb 1 at 18:32

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