I think comparing 1870-1970 period and 1970-onwards is a bit unfair.
We kind of know exactly why productivity exploded on n that period, and it is all to do with (later stages of) Industrial Revolution. All these people living on $1 / day suddenly started using machines providing power and automation. The cold water heated on fire was replaced by plumbing not by magic, but by availability of cheap pipes and boilers.
So basically, some time in 18th century, we figured out one trick, then milked it like crazy, and around 1970s we reaped most of the benefits of that one trick.
But now we're back to the pre-industrial revolution situation, where we are looking for various marginal improvements. Yes, there are other effects like rising inequality (so marginal improvements going to the owners not workers) but I don't see why you would extrapolate productivity growth from 1870-1970 and assume you can keep on achieving that.
Who knows, maybe AI will do that, multiplying human intelligence the way the steam engine multiplied human strength.
A big difference, though, is that since the 70's, rather than using our discoveries, out of fear of the consequences. The extent to which we harness energy is a strong proxy for overall productivity, and ever since nuclear got largely marginalized we've just been milking existing sources with diminishing returns. Starting roughly in the 70s.
I don't know, seems somewhat convincing on the surface but goes to mix some interesting ideas and facts with appeal to authority via quotes and a many unsubstantiated statements led by those ideas/aforementioned facts.
The one thing I always come back to is that nobody really seems to go into the definition of productivity - it's roughly hours worked to produce something, but the details are always sort of scarce, even from the FED.
I don't know, 1970 is also about where population growth started slowing.
1973 is also when we had the OPEC oil embargo and we went from a society arranging atoms to more of a focus on arranging bits / doing thought work. Before that productivity scaled with increased energy inputs. At least that's the argument I've heard Noah Smith make and it makes sense
To me, "WTF happened in 1971" has always been transparently obvious -- we moved off the gold standard.
I'm not a goldbug, I don't think we can put that genie back in the bottle. But with the ability to just create money out of nothing for free, without having to answer to some notion of conservation-of-whatever, is what re-appropriated a lot of human effort toward non-productive ends. That plus the rise of a debt-based society (driven by the banks' addiction to creating money, I mean, issuing loans) prepared the cultural and economic powerhouse that was the US and its effective vassal states in the West to move from primarily production to primarily consumption. In truth, the cultural shift began in the postwar boom and the advertisement and uptake of the proverbial "white-picket fence" lifestyle but was fully unleashed in the 70s.
I think it's probably one of the core causes, but trying to piece together how a barely noticed yet fundamental change in the technology that is money can cause all of these effects requires understanding money to an almost unreal level of depth. I'm still trying to figure out and wrap my head around it, but I think what they did had way more consequences than the architects of that decision realized, even deep cultural impacts, that, like many historical events, will only really be clearly understood in hindsight well into the future.
MMT perspectives, considered undogmatically, help a lot in this regard, as does the colloquialism that "money only has value because people believe it does". More or less everything follows from there.
Why would we have to work only on “productive” ones. Maybe non productive ones in your sense still have positive benefits that help us achieve productive ones better?
You're right of course, but it does so quite indirectly, frequently leaning on 2nd- and beyond order effects like incarceration rates, physics degrees, etc. It is not straightforward to connect them if you've always been steeped in the narrative America tells about itself.
Today's productivity crisis is readily apparent to anyone who plays mmo phone games. There are always people on at work.
The crisis was there before that. I've seen many people do nothing work related for hours on end. It's a lot easier to hide it with instant messengers and browsers.
And finally, apparently one of the reasons construction has seen no net productivity gains is because regulations have grown more complex and expensive. I bet that's true of many industries...
> And finally, apparently one of the reasons construction has seen no net productivity gains is because regulations have grown more complex and expensive. I bet that's true of many industries...
Also, construction appears to heavily involve manual labour. I am prepared to be wrong, but are there robots on construction sites yet or are humans still manually stacking brick walls?
looking around online, yes there are robots. very very expensive looking robots like the Hadrian X and SAM100, both for stacking brick walls. but who is building full buildings with 100% brick these days*? we probably got more productivity gains when we stopped digging dirt manually.
My guess is that any tech like this coming out now is at the far right end of an S curve and the real gains are to be made politically and socially, though i doubt it's a regulation issue like the quote.
thou ime construction has moved to prefabricated elements (import wall from factory) in order to cope with less skilled workers and higher labor costs while retaining some margin.
A friend of mine put it in terms of "boreout" and "burnout" jobs - I, for one, actually work all my hours and then some while he seems to only use 30-50% of his time on actual work.
Trust me you'd love to have one until you actually do get one.
Being imprisoned 40h/week with literally nothing to do and - depending on your work culture - being forbidden to do anything unrelated to work is by far one of the worst things for your mental health.
It's actually a known tactic to force workers to quit.
Worse, though some countries with lower productivity might have higher productivity growth.
But the problem with looking at it this way, is that it’s not a competition over finite outputs, it’s something that we can all get better at without taking away from each other. In fact one country’s growth usually helps other countries growth.
I wonder why the author considers war as negative to productivity when the ultra-productive century included two world wars. Isn’t destroying and rebuilding stuff good for GDP?
You are not the first to think that. That is called the Broken Window Fallacy, obviously by people who disagree. But it makes sense to me that if you spend resources on repairing damages, or weapons which don't generate more wealth, you are not investing and growing. What happened to the US in WW2 is an anomaly.
destroying and rebuilding stuff is good for GDP in classical Keynesian economics and most others based on that, but there have been criticisms that this leaves out the obvious part that there must be a negative side of the ledger indicating destroyed resources.
No, not at all. Destroying something, well, destroys it. Rebuilding it then means you spent a lot of effort with nothing new to show for it. That’s the opposite of production.
Readit News
We kind of know exactly why productivity exploded on n that period, and it is all to do with (later stages of) Industrial Revolution. All these people living on $1 / day suddenly started using machines providing power and automation. The cold water heated on fire was replaced by plumbing not by magic, but by availability of cheap pipes and boilers.
So basically, some time in 18th century, we figured out one trick, then milked it like crazy, and around 1970s we reaped most of the benefits of that one trick.
But now we're back to the pre-industrial revolution situation, where we are looking for various marginal improvements. Yes, there are other effects like rising inequality (so marginal improvements going to the owners not workers) but I don't see why you would extrapolate productivity growth from 1870-1970 and assume you can keep on achieving that.
Who knows, maybe AI will do that, multiplying human intelligence the way the steam engine multiplied human strength.
The one thing I always come back to is that nobody really seems to go into the definition of productivity - it's roughly hours worked to produce something, but the details are always sort of scarce, even from the FED.
I don't know, 1970 is also about where population growth started slowing.
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I'm not a goldbug, I don't think we can put that genie back in the bottle. But with the ability to just create money out of nothing for free, without having to answer to some notion of conservation-of-whatever, is what re-appropriated a lot of human effort toward non-productive ends. That plus the rise of a debt-based society (driven by the banks' addiction to creating money, I mean, issuing loans) prepared the cultural and economic powerhouse that was the US and its effective vassal states in the West to move from primarily production to primarily consumption. In truth, the cultural shift began in the postwar boom and the advertisement and uptake of the proverbial "white-picket fence" lifestyle but was fully unleashed in the 70s.
Why would we have to work only on “productive” ones. Maybe non productive ones in your sense still have positive benefits that help us achieve productive ones better?
The crisis was there before that. I've seen many people do nothing work related for hours on end. It's a lot easier to hide it with instant messengers and browsers.
And finally, apparently one of the reasons construction has seen no net productivity gains is because regulations have grown more complex and expensive. I bet that's true of many industries...
Also, construction appears to heavily involve manual labour. I am prepared to be wrong, but are there robots on construction sites yet or are humans still manually stacking brick walls?
My guess is that any tech like this coming out now is at the far right end of an S curve and the real gains are to be made politically and socially, though i doubt it's a regulation issue like the quote.
*turns out its australians.
thou ime construction has moved to prefabricated elements (import wall from factory) in order to cope with less skilled workers and higher labor costs while retaining some margin.
I would like a boreout job.
Being imprisoned 40h/week with literally nothing to do and - depending on your work culture - being forbidden to do anything unrelated to work is by far one of the worst things for your mental health.
It's actually a known tactic to force workers to quit.
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Lifestyle choices are not the closest problem to reality.
The deepest problem is that the most capable people have already mentally committed to the status quo, to secure their own wealth.
New ideas are the most oppressed type of thought right now.
There's more to say... what's the point? Gov and Market are both moving against breathing room for new ideas.
You won't get productivity without the capacity to change the type of thing we are doing.
I'd like to hear your "more to say", the point is to share your ideas. If you want.
But the problem with looking at it this way, is that it’s not a competition over finite outputs, it’s something that we can all get better at without taking away from each other. In fact one country’s growth usually helps other countries growth.
I think your point and mine together is that the way we measure economy has some horrible problems. Is there any economic measure of destruction?