http://www.businessweek.com/articles/2013-02-11/will-robots-create-economic-utopia#p1
This article discusses the possibility of a major sectoral shift in the future due to increased advancements in the fields of automation and mechanization. This does have the potential to create structural unemployment which could leave many workers short of a job but historical trends suggests that this will not create any sort of disaster.
The economies of the developed world have already experienced major sectoral shifts in the form of the industrial revolution. It is hoped that while the coming sectoral shift may have consequences in the relatively short term - it will be beneficial in the very long run due to increased efficiency of capital which will contribute to improving the returns to labor based on the Cobb-Douglas production function. And with proper government intervention in the training of unskilled workers, new jobs can also sprout up to keep the natural rate of unemployment under control.
This article discusses the possibility of a major sectoral shift in the future due to increased advancements in the fields of automation and mechanization. This does have the potential to create structural unemployment which could leave many workers short of a job but historical trends suggests that this will not create any sort of disaster.
The economies of the developed world have already experienced major sectoral shifts in the form of the industrial revolution. It is hoped that while the coming sectoral shift may have consequences in the relatively short term - it will be beneficial in the very long run due to increased efficiency of capital which will contribute to improving the returns to labor based on the Cobb-Douglas production function. And with proper government intervention in the training of unskilled workers, new jobs can also sprout up to keep the natural rate of unemployment under control.
The global economy is being reshaped by machines that generate and analyze vast amounts of data; by devices such as smartphones and tablet computers that let people work just about anywhere, even when they’re on the move; by smarter 'robots', as the article suggests. On top of that, services are now using computing power when they need it, instead of installing expensive equipment and hiring IT experts to run it. However, I agree with what the article states. The developed world is suffering more with regard to this 'robotization' a lot more than other countries. Countries like Brazil and China are still growing middle-class jobs because they’re shifting from export-driven to consumer-based economies. But even they are beginning to use more machines in manufacturing. The cheap labor they were dependent on is no longer low priced because their standards of living are slowly on the rise simultaneously.
ReplyDeleteThis could be good or bad. With how things are now, unemployment could rise substantially; but who says things will be like they are now? Robots create a new future. People are resistant to change, but change is inevitably good. Imagine where the world would still be if we always resisted change:
ReplyDeleteHere is a nice commercial that answers that question: http://www.youtube.com/watch?v=_IgH2M02xek