Tuesday, July 21, 2015

Sherk 'n Burke?

at the Heritage Foundation:
Automation and Technology Increase Living Standards
by James Sherk and Lindsey Burke

Many Americans blah, blah, blah... 
Lump of Labor Fallacy 
Fears of mass technological unemployment are predicated on a “lump of labor” model of the economy—the belief the economy needs a roughly fixed amount of work performed.In this economic model, machines automating work formerly done by people reduce the total amount of work remaining for humans, reducing total employment. Keynes forecast an impending crisis of unwanted leisure. He suggested future societies would establish three-hour workdays to give everyone enough work to avoid boredom.
Almost all economists reject this model today. Economists have found that an almost unlimited amount of potential work exists in the economy because people’s material desires continue to expand. Virtually all Americans today enjoy material living standards vastly better than the wealthy of 1900. Nonetheless, most Americans today would purchase additional goods and services if they received a raise or bonus.

Sandwichman's lump-of-labor odyssey