Are economists “barking up the wrong tree” by focusing so heavily on consumer goods, and hardly at all on jobs?

[Multicolored Lemur]

Alan Blinder - Wikipedia

en.wikipedia.org

Alan Blinder: “What if people care as much (or more) about their role as producers — about their jobs — as they do about the goods and services they consume? That would mean economists have been barking up the wrong tree for more than two centuries.”

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And good for him for asking the question!

Now, Alan is on the liberal side of the spectrum having served in the Clinton administration in the 1990s. But I have read a conservative economist economics writer saying pretty much the same thing.

And importantly, I bet we find solutions if we keep looking.

 

[Multicolored Lemur]

I say— Nothing quite like a new job to put pep in a person’s step! And sometimes you can get that feeling from quitting a crappy job because you then have new horizons and the prospect of getting a better job.

The standard advice is to get a new job while you already have a job. But personally, I haven’t always been able to follow that.

Oren Cass published the above book in 2018. He’s not an economist, but he is an economics writer. Which to me, means he’s a bridge person.

Now in one of his articles apart from this book, he asks, why is the hollowing out of whole communities — such as in the American rust belt — viewed as an acceptable cost?

And I myself add— Just so we can buy a bunch of cheap junk at Walmart? Seems like a bad bargain to me!

And again, we’ve got to look for ways to bend that curve.

And try promising solutions in a medium way. And then, either ramp them up or down depending on how well they work out.

Like I’ve said in another thread, we avoid abrupt changes to our economy.

 

[AgnosticBoy]

Now in one of his articles apart

Can you post a link to that article? Seems interesting.

I've been thinking about the future of our economies when it comes to automation, one world currencies, digital currencies (e.g. Bitcoin, Ethereum, etc.) However our economies turn out, I hope that new things are tried in the way you posted earlier...

And try promising solutions in a medium way. And then, either ramp them up or down depending on how well they work out.

 

[Multicolored Lemur]

Can you post a link to that article? Seems interesting.

Automation in Manufacturing is Not Hurting Employment | Issues 2020

MI’s Oren Cass explores how automation has been used in manufacturing for decades and does not “destroy jobs”. Cass argues that automation increases human productivity and it’s up to the firm and how they take advantage of the increased production.

www.manhattan-institute.org

And good luck. I don’t feel I fully understand the numbers part.

 

[Multicolored Lemur]

In particular, I don’t understand why “Real Value Added” is written on the dark blue.

 

[AgnosticBoy]

In particular, I don’t understand why “Real Value Added” is written on the dark blue.

Do you also mean why output decreased while productivity increased?

I think this part of the article sorta explains how that can happen:

In all cases, one implication of improving a worker’s productivity is that fewer workers will be required to do the same work as before. The effect on employment, however, depends on what happens next: do firms take advantage of the productivity gain to expand their output from the existing workforce, or to maintain their output and reduce their workforce?

A clothing company can has an output of 100 shirts a month using 7 workers. They find more ways to increase productivity by adding equipment and can produce the same amount of shirts with 4 workers. The scenario in the chart seems to be showing that the company has the same or less monthly output of shirts even though they have become more efficient at producing those shirts.

Not sure if that's what you were getting at. What I'd also want to know is why companies are limiting output. Is it because of decreased demand or more competition?

Either way I wasn't expecting to find much on automation and yet the article covered that pretty well. Thanks for sharing.

 

[Multicolored Lemur]

What I'd also want to know is why companies are limiting output. Is it because of decreased demand or more competition?

Maybe more companies are risk-averse, which is reasonable.

Or, too much of our economy has become a “rentier economy,” which I view as much less reasonable, although it may be a current fact of life