# Tag Info

64

This is an interesting question a lot of good labour economists have been thinking about for a while. There are a few conflicting theories as to what will happen. You could base a whole career on this question. This IGM survey will give you some idea as to what leading economists think. The prevailing opinion seems to be that increased automation is not ...

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Automation has been happening for a couple of hundred years now and right now we're all still working pretty hard. Although a 40-hour working week is standard, many people exceed this, and many families have two working parents. One reason for this is that we've used productivity gains for increased consumption, rather than decreased work. The industrial ...

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Here's an explanation from Paul Krugman. You can read more about this in Krugman's book End This Depression Now!. Since joining the Euro, Spain has experience large capital inflows—money flowing into Spain, mostly from Northern Europe. These inflows caused a boom in investment, coupled with an increase in prices of virtually everything (including labor) ...

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Your question relates to an important research topic on the link between automation and employment. David Autor works on this issue and the topic "Inequality, Technological Change and Globalization". He published a very recent and interesting JPE paper on “Why Are There Still So Many Jobs?” There have been periodic warnings in the last two centuries that ...

21

Horses were replaced by cars. Clerks were replaced by word-processors and spreadsheets. We have adapted to the technology and changed how we work. Therein lies the answer. Consider if you will a society where every person owns a robot and has that robot work on their behalf, freeing their time to pursue creative arts and learning like the nobles of old. Yes, ...

17

There are already excellent answers, but I would like to add in a different perspective: There will be fewer people. Not just jobs, but actual human beings - if there is less demand for human workers (i.e. laborers), due to machines taking over, the amount of "land" or other resource that a single human can manage will increase with technology, leading ...

16

How will non-rich citizens make a living if jobs keep getting replaced by robots and are outsourced? EDIT / UPDATE 5th November 2016: http://mashable.com/2016/11/05/elon-musk-universal-basic-income/ "There’s a pretty good chance we end up with a universal basic income, or something like that, due to automation" "I'm not sure what else one would ...

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I'm going to give a less economically rigorous answer, and address your concern about your own situation. Jobs change. Your skillsets will always need to change. If you are young, it's a certainty that you will not be in the same job, or even the same career, your entire life. It's likely that many of the jobs you will do in life don't exist right now. ...

14

Neither the answer posited above nor the comment are off the mark. Inability to use monetary policy to adjust to a shock is certainly a cause of high unemployment in the aftermath. Idiotic fiscal policy doesn't help either. The very last thing to try to do after such a shock is to eliminate government deficits in such situations. It becomes a vicious -- ...

9

To me, it seems that it has increased, not decreased, due to the factors you mention. Yes, transportation and information networks enable workforce movement. But they also enable movement of goods and information - and because goods and information are more mobile than humans, they profit more, and the results of their portability outpaces the results of the ...

9

I understand that you are asking the following Up to now, we have avoided structural unemployment because we increased production by more than what the technological efficiency gains implied (and so eventually re-employed the labor that had become initially obsolete, usually in other industries). But if finite resources put constraints on how much ...

9

I am surprised none of the posts above discuss the following paper: Autor, D., and M. Handel. "Putting Tasks to the Test: Human Capital." Job Tasks and Wages" Journal of Labor Economics (2009). This paper discusses your concerns and addresses why your concerns are quite well grounded in both theory and empirics. Tasks that are more routine do offer lower ...

8

The way I see it, there are two possible futures given the increasing state of automation in the world. Future One: A Basic Income We decide as a nation, federal state, or world, that human beings are important in and of themselves. Every human receives an income from the state which enables them to support themselves, without any necessity for work in ...

8

A very famous study in this direction is Card and Krueger (1994). They look an increase in the minimum wage in New Jersey in 1992. While New Jersey raised the minimum wage from USD 4.25/h to USD 5.05/h, the minimum wages remained at $4.25 in adjacent Pennsylvania. You should have a look at the subsequent research. 7 The general way people figured the Phillips curve worked was that a shock in aggregate demand or fiscal stimulus would cause labor demand to increase as government spending generated growth, which makes labor more scarce and causes firms to compete for workers by raising nominal wages. Wage costs then rise, and the firm passes on some of the cost to the ... 7 In Progress and Poverty, Henry George claims that the advancement of technology eventually leads to increasing the land value and the land rent. This means that people who own land will have a high income, whether or not they work, while people without land will have to pay most of their free income to the landlords as rent. 7 Intentionally unserious answer. Let's just take the individual's possible reactions to "having their job taken over by a machine" and scale them up to the macro level. Find a job in another field. At the macro level that means a rapid societal reconfiguration. (Like Japan after WWII.) Imagine a Ruby On Rails web services test engineer going back in time ... 7 How is the minimum wage determined? Yes and no. It is a political choice, but with economic reasoning. In the end, that's the case for every economic rule, maybe with the exception of monetary rules, as we try to preserve independence for central bankers (but it isn't completely true for the US FEDs). When setting the new minimum wage, you compare minimum ... 6 Full employment is a more general term, which has much less implication than natural rate of employment. My experience reading a lot of economics papers is that careful authors do not mix the two concepts. Stricto sensu, full employment should mean 100% of the workforce is employed. But when we are talking about periods such as the trente glorieuses, the ... 5 Are current flows of migration bigger that they were in the past? We tend to forget history because the numbers involved currently are smaller relative to world population. For instance, the 8.8 million immigrants who came to the United States in 1901-1910 period is of similar magnitude to the 9.1 million immigrants who came in the 1991-2000 period, but ... 4 UPDATE After e-mail communication with one of the authors G.W.Kaplan, I recalibrated the value of the vacancy-posting cost parameter$k$in order to obtain a cross of the two nullclines for$u=0.05$. This is achieved for$k=7.41$(rounded). Moreover, with this value of$k$, I get a second (but not a third) steady state. A close up diagram : This still is ... 4 This question as is (October 2, 2015, 15:07 Athens time) should be closed and I voted to that effect. I provide an answer in order to show why it should be closed. As any natural or legal entity, the "Fed" engages in strategic behavior. Strategic behavior is not a priori constrained by moral considerations (and this is why Game Theory has come under fire ... 4 Keep this in mind. The richest 1% aren't cannibals. What I mean by this is that the richest 1% have become the richest by getting their product(s) to the populous. If the populous can't afford a product, then there is no motivation to invest the capital required to create the product. The product will exist as a wish until some young enterprising soul ... 4 Once artificial intelligence surpasses human intelligence, it will be up to A.I. to determine how we spend our days. On the one hand this already occurs. When you go online, algorithms are constantly trying to put you into so-called funnels of a variety of business models. Whether it is to click on ads, pay for digital products or order services and goods, ... 4 Wage-goods are goods that a worker with wages might buy, perhaps now more commonly called consumption goods Non-wage-goods are goods that a rentier receiving profits or interest might buy, including what might now be called capital goods or investment goods As to how to read Keynes's interpretation of Pigou's position (so actually neither Keynes's nor ... 4 Here is a chart from the OECD, which shows the net fiscal impact of migrants on their recipient country (i.e. by how much to they contribute or withdraw from the welfare state, albeit excluding in-kind benefits such as healthcare). For most Western countries, Denmark included, migrants are modest net positive contributors ("they pay in more than they take ... 3 JOLTS actually goes back to 2000 (though years before 2005 are only available on a SIC basis). Prior to JOLTS, most people used data on the number of help-wanted ads in newspapers, such as this series from the 1950s-60s or this one that goes back to 1919. 3 Found my mistake. I guess I'm not allowed to move the thetas to the other side. Define$q^{-1}$be the inverse of$q$. Then, $$\theta = q^{-1} \left( \frac{c}{J} \right)$$ $$\frac{W_1}{W_0} = \frac{f(\theta_0)}{f(\theta_1)} = \frac{f \left( q^{-1} \left(\frac{c}{J_1}\right)\right)}{f \left( q^{-1} \left(\frac{c}{J_0}\right)\right)}$$$J_1 > J_0\$, ...

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On remittances: It is not unusual to hear about income being sent home by, say, US immigrants. However, the product of their labor and the side effects of their intellectual capital, sometimes called positive spillover, do not occur in the home country. As such, they are not as beneficial as some counterfactual world where an equally profitable job existed ...

3

On a lighter note,...... Robots do not eat, drink, buy consumer goods or take their date to the movies. Who is going to buy the goods that the robots produce if all the workforce is out of a job. Do not be afraid of Technology, the economic equilibrium will balance itself out eventually. It's the greedy/powerful people you need to worry about.

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