Thursday, May 19, 2011

ECONOMY - Technology and the Jobs Question

"The Great Stagnation: Why Hasn't Recent Technology Created More Jobs?"
PBS Newshour 5/18/2011

Excerpt from transcript

ERIK BRYNJOLFSSON, Center for Digital Business, MIT Sloan School of Management: It's a big error to think that technology automatically improves everyone's lives evenly. It's entirely possible for technology to make the pie bigger, but not have that pie evenly divided.

What's happened with the most recent wave of technology is what economists call skill-biased technical change, technology that benefits relatively more skilled workers and hurts the livelihoods of people who maybe who have high school educations. As a result, the median income has stagnated, even though overall wealth in the economy has grown quite substantially.

PAUL SOLMAN (Newshour): Tyler Cowen, of course, sees the problem differently: an innovation drought, relative to the industrial revolutions of the past and to other countries today.

TYLER COWEN, (author) "The Great Stagnation": The problem is, we have not come up with the bigger and better endeavors to reemploy people, power our own growth and have us be leaders in new and important areas.

PAUL SOLMAN: But to Erik Brynjolfsson, the problem is the nature of progress itself these days.

ERIK BRYNJOLFSSON: I'm an optimist about technological progress, but I'm not nearly as optimistic about our ability to keep up with it.

We have got some real problems. I just want to make it clear that the problem is not stagnation. The problem is more serious in some ways, which is our basic human ability to keep up with technological progress. That problem is going to get worse and worse as technology speeds faster and faster.

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