Technological progress has always been inherently deflationary.
Remember, the vast majority of the world's people used to work directly in food production as a matter of necessity. Technology has allowed most of us to get off the farm, and pursue other activities.
Whereas a day's work once bought a day's food and not much more, a human worker (using the machines that serve him) is now able to produce a huge surplus of wealth. This means that there's time for leisure, and that our leisure can be much more enjoyable than our grandparents'.
The tragedy of this seems to be that we're running out of stuff for people to do. A dystopian version of the future this could lead to is recounted in 'Manna,' by Marshall Brain: http://www.marshallbrain.com/manna1.htm
For my part, I'm hopeful. I believe that our current plight is the same sort of growing pains we've experienced in the past. The invention of the automobile made it tough to find work shoeing horses, for instance, or manufacturing buggy whips. Just because we don't need to spend our time making stuff any more doesn't mean we won't be able to find other ways to occupy our time.
I think people will HAVE to work, for some very hard years, on achieving sustainability. Only then will we truly be on autopilot, and will humanity be able to focus its time on other things. Until then, all we're doing is tricking ourselves into thinking life will keep getting easier. Major conflict over resources is coming...
While it's true that we have a lot of work to do, conflict is unpleasant and expensive and people on the whole have a strong interest in avoiding it. Unfortunately, war mongers tend to spend other people's money, so they don't bear the costs; we need to stop supplying them and/or make them pay. If we can manage this, I think our adaptability and ability to cooperate can win out.
>The tragedy of this seems to be that we're running out of stuff for people to do.
I'm sorry but this is just wrong. There is no end to human want and desire. As long as there is this want there will be plenty of stuff for people to do.
I'd side note that estimates are still 1 billion people work in agriculture (ref: grain.org/world bank) and many more are in the transportation, processing, and selling of said agricultural products. The vast majority of these people still only earn enough or little more than enough for a day's food (not a huge surplus of wealth). Furthermore, lack of capital (lack of machines as you will) is still prevalent in many industrialized countries, even in the U.S. Disclaimer: I work for Kiva now, so my perspective is skewed to focus on this group of the world.
>The tragedy of this seems to be that we're running out of stuff for people to do.
There is a lot to do for humans. Just look at the problems in any area of science. Not all people are qualified to work there though. This is why instead of whining about disappearing of menial labor jobs, we should be working toward [what would be at least a start] making K16 a basic level of education instead of K12. A thousand year ago reading and writing would made one a basically educated person (for the rest of his/her 30 year long life). In 19th century K8 was enough (and the average lifespan ~45), in 20th for the most of the part - K12 (and the average lifespan is ~70 at the end of the century). The body of knowledge is growing, we live longer, so it is natural to learn more and apply the more advanced knowledge and skills for longer period of the active adult productive life.
I'd fix K-12 before we make K-16 the default. You could easily learn fit the amount of material in a K-16 education into 12 years if those 12 years weren't just a matter of putting in time without any real focus on learning the material. Let's improve quality of education before increasing quantity.
>You could easily learn fit the amount of material in a K-16 education into 12 years
>Let's improve quality of education before increasing quantity.
nice sound bites. Complete rubbish. The whole amount of K-12 material is comparable in size with amount of material consumed in just one, max 2, years of college. But it doesn't work in the opposite way. I graduated from a top math and physics high school where students were selected from half of the country. The amount of additional material what we were able to consume during the high school pales in comparison with amount of material we consumed later at the University. The brains is still not there at this age. Hormones already are :)
Average lifespan was very scewed because of high children mortality. If you survivied first few years chabces were pretty good that you'd live longer than average life expectancy told.
While technological progress can be deflationary I have to strongly disagree that work is disappearing. I don't think we are ever going to run out of work.
In fact, more "primitive" societies had far lesser work to do - "studies show that hunter-gatherers need only work about twenty hours a week in order to survive and may devote the rest of their time to leisure", though there are criticisms about the measurement.
Also -
"The Kapauku people of Papua think it is bad luck to work two consecutive days. The !Kung Bushmen work just two-and-a-half days per week, rarely more than six hours per day.[30]
The work week in Samoa is approximately 30 hours,[31] and though average annual Samoan cash income is relatively low, by some measures, the Samoan standard of living is quite good."
If you want to talk about "survival", you can easily survive comfortably, much more comfortably than hunter-gatherers, today on even less work. Buying lots of junk and traveling are not needed for comfortable survival, if you want them, buy them, but don't confuse them with even comfortable survival.
No, we are not talking about "survival". If an alien were to observe that of the 3 tribes one spent 50 hrs working, the other 30 hrs and 20 hrs respectively, he will conclude that it is the tribes working 50 hrs that have a tough time surviving. The other tribes weren't hanging on for dear life, otherwise they would have worked much harder. They have plenty to eat and hence plenty of leisure time.
Also, I dispute that buying lots of junk is unnecessary for a decent life in industrialized societies. We are socially competitive animals and if someone were to just focus on "survival", he would end up being a social outcast pretty soon and his mating prospects would have shrunk considerably. Being lazy and having low-income is a pejorative description in industrialized tribes. But Western society has such huge income gaps that no matter where you are in the income spectrum, it looks like there are thousands of people above you living the good life, right up until Bill Gates.
In contrast, in a hunter-gatherer society, the most accomplished guy might be the chief and the competitive pressure on each tribal is much lower. Hence, the possibility of a 20 hour work week.
TLDR, I dispute that technological advances will reduce work. As long as there are huge income gaps, we will have people relentlessly working long hours every day to obtain a better position in society. It is an instinct built into our genes.
Grandparent's point is that you haven't held everything constant.
Hunter-gatherer types don't have a home. If you are willing to go homeless, you can live for $15-20/day in most cities. That's less than 20-30 hours of work/week in most places.
Hunter-gatherer bands also have a total mating pool measured in the half dozens. If you restrict yourself to fellow homeless people, you're likely to meet a similar number of women, all of whom have roughly the same social standing. The problem is not that there are no mates available, it's that there are no mates that you want available.
Your point that people tend to measure themselves relative to people around them is true but orthogonal. If you hold living standards constant, you can achieve them with a lot less work today than you could at hunter-gatherer tech levels. It's only because living standards are not constant that people have a tough time earning a living.
Actually, in Quebec (not sure about other provinces and the US), you can live comfortably (if we compare with hunter-gatherers) without working at all through welfare.
It would be so much more useful to hold happiness or quality of life constant instead. I really don't think it's a meaningful improvement to have ten times as much material wealth if that goes along with a fifteenfold increase in the amount of material wealth you think you "need", especially if that goes along with increased workload, stress, responsibility, etc., and decreased leisure time, time with family, health, etc. To most westerners it seems obvious that a nice house and your pick of hundreds of mates will make you happier, but that's just because it's how we grew up. If we packed it up and tried to go hunter-gatherer tomorrow, we would fail miserably and be miserable doing it -- but that's what exactly happens when hunter-gatherer societies and agricultural societies suddenly go western. Either way it takes several generations to adjust, so the fact that you wouldn't feel comfortable living as a hunter-gatherer, now that you've already been raised in this culture, doesn't have anything at all to do with which lifestyle is better. Even your "objective" measurement made a value judgment that meshes with industrial, not hunter-gatherer, societies. Of course an industrial society will do better by industrial standards.
Being a hunter-gatherer born in a stable hunter-gatherer society is not at all the same as being a homeless person in the industrialized world. For the most part hunter-gatherers in a hunter-gatherer society aren't ostracized or looked down on by everyone they know, criminalized/shamed for living (finding "acceptable" opportunities to sleep, eat, piss, etc, are much more difficult for a homeless person), or surrounded by messages that a person's worth is measured by whether they own the right things. Being able to comfortably meet biological needs, having meaningful social connections, retaining dignity and self-respect -- these things mean a lot.'N!ai, the Story of a !Kung Woman' is an interesting documentary about a woman whose life took a dramatic turn for the worse after the introduction of western culture, even though she probably ended up being the richest person in her tribe.
AFAICT more technology has nearly always led to us taking up different kinds of work to fill up that time, not more leisure. When modern household appliances were introduced, the result was higher standards for housekeeping. Women in the 70's spent slightly more time doing housework than women in the 20's did despite all the new "conveniences". Were houses in the 20's disgustingly filthy? No. Did the increase in cleanliness make society as a whole happier or better off? I doubt it. If anything, I suspect the obsession with cleanliness has just contributed to increased rates in allergies, weaker immune systems, etc. Technically, access to these appliances are considered a standard of living increase, but all it really did was make us pickier about what an "acceptable" living is. Now people who can't afford those conveniences have to work harder to keep up or be shamed by others for having a "dirty" house.
People comparing themselves to others is very relevant, because those comparisons have a huge impact on happiness and quality of life, and it is generally assumed that a higher standard of living correlates with those things. (If you disagree, can you explain why having a higher standard of living is a good thing? Why is it rising? Why do we even care about it?) If that's a wrong assumption it needs to be challenged because from what I can tell it's basically a cornerstone of western civilization right now.
Happiness is constant. That's the whole point of all the research into the hedonic treadmill. Good or bad things in your life can make you feel happy for a short period of time, but eventually we return to our set point, which is largely determined by genetics.
Given that you're fucked over by your genes and can't actually make yourself happier, why not live your life based on maximizing your standard of living? At least that way, you can look back and say "Well, even if all those things I'm stressing out about happened, I lost my job and my family and had to go homeless, and no girls would talk to me, I'd still be better off than a hunter-gatherer."
It's not that achieving a higher standard of living makes you happier, it's that achieving a higher standard of living and believing that standard of living is the key to happiness lets you look back and see by an "objective" measure that you're doing better than you were before, and that makes you happy.
As far as I'm aware, the hedonic treadmill is a culture-bound theory. Has anyone actually done serious research about it outside of the 'developed' world? Also, by my understanding, it doesn't state that long-term lifestyle changes won't make you happier, just that our happiness levels stabilize quickly after sudden changes.
Genetics may be one factor, but relative differences in wealth is another huge factor that I know has been observed extensively outside of dominant western culture. In HG societies, there are almost no differences in wealth. Everyone considers themselves pretty well-off because there are very few things (or experiences) in their world that they could want but not have.
And even by the objective standard, a HG is better off than someone in the industrial world who has no job, family, home, or love prospects. An average HG has meaningful work, a large and close family, a mate, and considers their entire territory to be their family's "home". It isn't a miserable or unfulfilling life at all. The only way you could come to the conclusion that you're still better off is if you held really stereotypical and inaccurate views of how HGs live. Which leads like things like groups of us deciding that we have a moral obligation to nose in on what few HG societies still exist and bestow the gifts of technology and capitalism on them, so that they can live in slums for the rest of their lives and the lives of most of their descendants. Which doesn't exactly make them happy, because they go from being the richest people in their society to the very bottom of the ladder in ours.
I'm not going to live my life maximizing my standard of living because money and wealth aren't the same thing. Call it fulfillment instead of happiness if it makes you feel better, but having the biggest pile of money isn't the way to get there.
I feel like this should be titled "I don't understand the new economics". The economics of a material world are different than the economics of an information world.
Rob Gingell used to point out to me that people living during the revolutionary war didn't have a good feel for what the final rules were going to be either.
So I buy the insight that it takes fewer people to create Facebook today then it did to produce Chevy Malibu's in the 70's, however Facebook is creating opportunities for people like Zynga so you really have to ask yourself what is the set of all the people working on Facebook, or applications for Facebook, or applications that let you visit Facebook, or derive demographic data from the information pool of Facebook?
This is what will distinguish the information economy from the material economy. In the material economy the product (our example is the Chevy Malibu) is a dead end, it gets created, used, and discarded. In the information economy people build products which turn out to be pre-cursor materials to other products, or combined into still other products. Information products, even those that are nominally not 'tools', by their nature can be composited into new products, just like a DJ might create a techno trance mix of three or four of her favorite tunes.
Google, employs 24,000 people (approximately), and how many people have careers that exist only because Google (or I guess more properly search engines) exist?
So I read articles like this one and I feel like the author (in this case the meta author because the NYT is talking about Cowen's book) are struggling to understand something their brain wasn't prepared to understand, which is that information, like a Chevy, can have intrinsic value. Further its value persists as its "re-manufactured" into new information by people skilled in the art of doing so. So without the tools to understand the economics of information they see money like Google's billions but can't see the mechanism that creates it.
I think you've missed a core point of the comparison:
Chevy Malibu's weren't built in isolation, either. They were built from parts, in factories built by people who specialized in building factories (we call it, in very generic terms, the construction industry). They were serviced by gas stations and mechanics. There is an entire industry focused on producing rubber, primarily for automobile tires. There's another industry which builds tires, and another that refines oil, one that focuses on fixing scratches, another on cleaning the devices.
The argument that the information world is the first to stack industries on other industries is fallacious, and misses the point entirely: Information doesn't take labor for every instance of product.
This is the core difference between information manufacture and real good manufacturing.
Real goods, such as the Chevy Malibu, have a pyramid of raw materials starting with ore mining, through smelting, through plastics creation, through tooling, to piecework to sub-assemblies, to assemblies to product.
Information goods on the other hand start with generally lower value information which gets collected and distributed and refined into higher value information. An inverted pyramid if you will.
And unlike ore, which once its in a Chevy Malibu is locked up 'forever', the information that is created can be re-used in an infinte number of additional products.
Consider a contructed example of company A which makes their money selling the current stock ticker from the NYSE, to company B, which takes that data and does analysis on it to create trading strategies for resale, which are purchased by company C which uses the trading strategies combined with capital acquisition from clients to make their money.
A completely different company, Q, might take the same stock ticker information from company A and make a large LED sign which can display it and sell those.
So the same 'information ore' is used in two separate product streams. There can be dozens of such streams. So evaluating the value of Facebook's information by the number of people Facebook employs really misstates the economic impact of a company like Facebook.
"The argument that the information world is the first to stack industries on other industries is fallacious, and misses the point entirely: Information doesn't take labor for every instance of product."
I don't believe I made either of these claims.
To be clear, the claims I make are;
1) Evaluating the information economy using the 'rules' of the real goods economy fails.
2) The information that Facebook and Google create is more analagous to the ore someone might mine out of a mountain than the end product of vehicle brakes. (the real goods example used in the article).
I will grant you an example of someone making money off creating after market products for the Chevy Malibu as a valid post production economic activity, I know of no examples where people have collected Chevy Malibus and then turned them into a product that itself had mass market appeal.
It is the distinctive characteristic that information can be combined into new information which has its own intrinsic value, without losing or consuming the source information (ie removing its ability to take part in additional economic activity) that, for me, differentiates the two economic models.
Information =/= experience. Two different things. The author is referring to the experiential aspects of Facebook, i.e. keeping in touch with friends, etc. Not the actual information on the site. That's why he brings up college dorms being nicer - since it's difficult for universities to provide a better education, they focus on providing a better experience.
A key concern is whether there will be enough good jobs for people with insufficient intelligence or training in post-material world.
It is common for anyone who has lived in a developing country to see a big divide between plenty of people who hold unskilled service jobs and a much smaller minority whose jobs require some sort of intellectual abilities or high-level salesmanship. Wage of the latter group is 7-20 times larger than the former. The middle group, whose jobs revolve around routine skills like clerical or secretarial tasks, see their jobs disappear one by one. For example, Google translation and IBM's Watson systems, once a bit more mature, will be better than lower-skilled translators and researchers.
If middle-tier jobs are reduced to an insignificant amount, the world of jobs will be divided into two major classes:
1) Jobs that require high-level of intelligence to make decisions/automate tasks/invent new technology or those that require purposeful human relations building and salesmanship.
2) Jobs to service those holding jobs in class 1)
The problem, as implied by the article, is that the number of people needed to do jobs in class 1) is much smaller than world population. The excess of labor pool for jobs in class 2) leads to much reduced wages and clear division in standard of living. With increasing wealth in society and distribution program, people holding class-2 jobs can still live fairly comfortably, but the ideal of egalitarian society will be even further from reality than today. (Egalitarian societies did not exist for most of history; they are in fact quite an anomaly to appear in quite a few countries in the world today--even in imperfect form.) Will the class-1 job holders protest ever louder about increasing wealth redistribution to the mass? Will the class-2 job holders be unsatisfied with status quo and seek to confiscate more wealth from the other group?
Is there a good way to preserve the egalitarian ideal or at least achieve a harmonious society without violent changes? I invite you to discuss.
David Brooks almost wrote an interesting article there.
The beginning is promising, he writes about the different growth rates in developing vs developed countries. This is a well established economic fact. There's an opportunity to infer something from this... Brooks just never quite gets to it.
Another interesting idea he does not clarify but does mention is the productivity improvement we have experienced over the course of this (and last!) century. Technology has greatly reduced the need for labor. Again great potential for a discussion which Brooks is never able to take anywhere meaningful.
Instead the article slowly degenerates into some kind of drivel about hypothetical individuals states of mind... I don't even, what?
It's kind of sad when someone clearly has the education to start a discussion but just completely lack the personal ambition to write to a much higher standard.
Write about hard facts, falsifiable theories based on them. Write something more akin to a readable scientific paper.
Instead we get something which resembles a bright high-school student's essay on the human condition in a consumerist world.
But that's what the work of an op-ed columnist must be like.
If you told me I was doomed to be a ditch digger, I would be quite upset, but I'd get over it.
If you told me I was doomed to sit in a cubicle, well I'd be rather upset that I'll never fulfill my dream of working for myself but I would get over it.
If you told me I was doomed to create nothing other then op-ed articles like this one, I would shoot myself.
Skip the last few chapters. The author's personal (religious) beliefs start to show, and his line of thought weakens (experience economy leads to "transformation" economy, in which people seek to be "transformed.") The majority of the book is an excellent read, though.
Slower? The typical office of 2011 might as well be an alien planet to someone looking from 1981, in comparison to 1951-1981. Computers, fax machines, the Internet, cellphones, social networks, viral marketing, hiring people you've never met in foreign countries and who directly report to you.. several areas of worklife (heck, life in general) have been totally redefined in the past 30 years at a speed never seen before.
Intensely interesting. This is the most poignant section in the article:
"For example, imagine a man we’ll call Sam, who was born in 1900 and died in 1974. Sam entered a world of iceboxes, horse-drawn buggies and, commonly, outhouses. He died in a world of air-conditioning, Chevy Camaros and Moon landings. His life was defined by dramatic material changes, and Sam worked feverishly hard to build a company that sold brake systems. Sam wasn’t the most refined person, but he understood that if he wanted to create a secure life for his family he had to create wealth."
I would add to this that between 1950, when Sam was an adult member of the working class, though nearing retirement, the world's population was 2 billion, and today, the world's population is 8 billion. That in itself is going to manifest incredible levels of change.
I think the trend we're going to see over the NEXT century is going to be a return to production, away from SOLELY consumption of goods, simply because, as the article stated, there are fewer low hanging fruits. Couple that with many more mouths to feed, and you have a recipe for a very different world in 100 years.
I believe just for the human race to survive, people will need to start growing food, en masse, at a local level. Even people in cities. Energy consumption continues to rise, but the means to produce it become more and more expensive. We will need to produce alternative methods of energy gathering - which are renewable. So what does the future hold, in my opinion?
1. Rapid population decline after continued population growth because of lack of ability to support growth (ie Malthusian theory)
2. A "return to the farm" - a resurgence in small farms. Energy costs WILL bring down big agrabusiness - just wait.
3. People using more LOCALIZED means to generate energy. In the Philippines, for example (I was there in July 2009), there were a lot of geothermal plants being built near volcanos. Hawaii has been investing a lot in harnessing wave power (and generating a lot of controversy from the surfer community). I attended a "Blue Planet" presentation in Honoulu in May 2009 and talked to many of the leaders of this initiative. Germany is the world's LEADER in solar energy now. People will take what they can get, where they can get it, to meet their power needs. Even in rural Kentucky, people are starting to put solar panels on their houses.
4. Thank god, less of an obsession with money and stuff. Basic survival will once again trump all other needs until we can again reach a level of production where people can go through another lazy cycle.
Aside from the fact that our global growth rate has been dropping for the last twenty years, I'd like to point out that actually feeding the population isn't a problem. Feeding it beef may well be, but the primary issues with world starvation is that the market is held above their heads by unnatural means (fallow field subsidies in the US, solar subsidies in Europe, and lack of agricultural subsidy in Africa, just for example). Big agrabusiness, BTW, exists only because it is more cost-efficient than small farms, and as such could better weather rising energy prices. Energy prices will not ever be high enough to crush big agrabusiness; A large agrabusiness would build private nuclear plants first.
Beyond that point, Localized fuel is a funtion of rising fuel prices. Energy exists in the world, in the form of deep sea oil, shale oil, natural gas, and coal on a scale that makes a mockery of any renewable movement.
Its about cost-effectiveness of extraction, which, as energy prices rise, will make so many sources of energy available to us long before it makes renewables an efficient plan.
All good points (very good points). I think we will see the cost of extraction result in a net energy loss by the end of the decade, and maybe sooner. I could be wrong, though. As for growth rates, where do you see that global growth is declining? I think that's only in advanced industrialized societies (like Germany and Japan) where birth rates are lower than death rates. Even in the US, population continues to grow, and big increases are expected.
It's been a while since I researched it, but my impression was that the growth rate had been decelerating since the seventies. Not that it isn't still a growth rate, just a lower one.
About energy, I expect that higher prices make many more sources of energy available to the market than is available now, and I don't expect the demand to drop without a very fundamental change....we've still got lots of room for energy prices to go up in our market.
I'm always skeptical about predictions of a coming food shortage. It's been predicated for the last 200 (Malthus' An Essay on the Principle of Population was published in 1800), and it hasn't happened yet.
It doesn't prove it's impossible, it proves that the original predications were well off. Back then people though 1 billion people were enough to worry about the lack of food. We're at 8ish billion now and people are still worried. The world survived.
Actually in a more relevant parallel to Brooks's comparison, Larry Page's grandfather worked on a Michigan auto assembly line. I don't think the grandson's economic contributions are that much less tangible or clearly valuable than the grandfather's.
I watch a lot of moves from the early 80s, Back To The Future I is my favorite.
What we (Americans) had then and now has not really changed much. Items are either faster, larger or cleaner looking, but they essentially do the same thing they did in 1981.
The materialistic items sold today, don't add any marginal value to our lives. The iPad doesn't improve your life by much or at all. I think its good that people are realizing this and focusing in on enjoying life spiritually.
I think asking "how many jobs does X create" isn't as useful an analytical framework as its inverse, "how productively does X allow its workers to create new things of value".
So US growth started stagnating in 1974 (allegedly). There's something familiar about that number. Something to do with the gold standard? Coincidence?
It wasn't a statement, it was a question. So now questions about monetary policies in threads about economic stagnation are being down voted on HN, good to know.
Remember, the vast majority of the world's people used to work directly in food production as a matter of necessity. Technology has allowed most of us to get off the farm, and pursue other activities.
Whereas a day's work once bought a day's food and not much more, a human worker (using the machines that serve him) is now able to produce a huge surplus of wealth. This means that there's time for leisure, and that our leisure can be much more enjoyable than our grandparents'.
The tragedy of this seems to be that we're running out of stuff for people to do. A dystopian version of the future this could lead to is recounted in 'Manna,' by Marshall Brain: http://www.marshallbrain.com/manna1.htm
For my part, I'm hopeful. I believe that our current plight is the same sort of growing pains we've experienced in the past. The invention of the automobile made it tough to find work shoeing horses, for instance, or manufacturing buggy whips. Just because we don't need to spend our time making stuff any more doesn't mean we won't be able to find other ways to occupy our time.