Monday, March 9, 2015

"Jobs, automation, Engels’ pause and the limits of history"

The lazy but common retort to the idea that technological advancement would massively displace workers has long been to accuse the fear-monger of having perpetuated the lump of labour fallacy. 
Luddites!, the response goes, technology constantly takes jobs from workers, but the gains in efficiency lead to a surplus for the owners of companies (via higher profits) and for the consumers of their products (via lower costs). Those surpluses are then spent on other investments and consumer products, some of which we haven’t yet imagined but nonetheless will lead to more jobs in other sectors. 
Buy a cheaper car, and you have more money to spend on lavish restaurants, which leads to more jobs for chefs and waiters and sommeliers, and so on. 
Optimists also like to cite the teachings of history in addition to the Luddite mistake, as the two are obviously related. So many times have we worried about the destabilising potential of technology, they say, and every time the economy has adapted, creating new jobs to replace the lost. 
An appeal to history isn't inherently misguided. Our understanding of the world is unavoidably shaped by the historical behaviour of the variables that we can identify as useful for our assessment. What else can we do? 
Yet the more aggressively we scavenge history for useful lessons, the more confusing are the clues we dig up. And that’s to say nothing of the clues that we fail to dig up. 
A few points are useful to keep in mind when thinking through history’s lessons for the issue of jobs and automation. [continued]
 The Sandwichman is very pleased.

1 comment:

Denis Drew said...

My reading of The Making of the English Working Class is that individual weavers selling their wares to individual sellers made a decent living. When the steam looms came operators were 10X to 100X more productive than the individual weavers. Yet they and their children were reduced to eating rice cakes three times a day because they couldn't afford wheat bread. Forget meat.

This because they had lost the equal to equal bargaining power balance that the weavers enjoyed with their buyers.

If we are worried about the humane impact of robots on employees -- better we make the society we have now as humanitarian as possible as a starting point (like German, Denmark). That can only mean effective labor unionization (in particular, centralized bargaining).