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i am harry posted:I'd like a historical example of a time when something caused mass job loss across multiple industries in the same decade please. Great Depression, the golden example of an oversupply crisis, feels appropriate. World War I and the Roaring Twenties transformed radically the American industrial base, with large adoption of several new technologies which ordinarily wouldn't be implemented in such a short scale if not for the massive consumer demand spike caused by an Europe that suddenly stopped supplying the world with industrial goods. Major industries in the US adopted electrification, the assembly line, better logistics, trucks, modern machine toolmaking, etc whose structural unemployment effects were not felt because of the massive ramp-up in global demand in the short term. However, by the end of the decade, demand elasticity turned out to be a very real thing. People living under a tremendously unequal economy plus major wage stagnation across the main Western markets wouldn't be buying washing machines or electric ovens every three months to curb the massive stockpiles of overproduced goods. Companies were unable to sell and their stocks plunged en masse. There is a misconception that the Great Depression wasn't a structural, technological outcome due to the massive historical circumstances involving it, but economic history is pretty more elaborate in that sense. The United States was the only country in that period which had enough capital to quickly capture global industrial good demand through massive investment (which in short very intensive bursts is simply the implementation of new technology in a very agressive manner), in which it was extremely successful. Also, it is the first clear example of the "global" and systemic nature of the technological problem - this new and massive American industrial base post-WW1 effectively sequestered thousands upon thousands of European industrial jobs that were never recovered to their apex, even in WW2. Latin America's modest industrialization also created local capacities for basic goods like canned food or soap that were all imported from Europe.
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Dec 6, 2016 17:00
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| # ¿ Apr 27, 2024 10:20 |
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Automation economics isn't a simple thing like researching a tech and getting a 20% bonus in a strategy game. It happens gradually and according to the factors and pressures of a given system. The major misconception why "automation creates jobs!" that comes from neoliberalism has actually its roots on Say's """law""", which says that production generates its own demand. This has been proven false even during the classical economic development period; David Ricardo edited his own Treatise because he admitted that he was wrong in thinking that the jobs that machinery would eliminate would be recreated due to Say's law because the overall production has increased, but he lacked the means or the awareness to realize the specifics. Thing is, structural unemployment is a very real thing because whenever you had a panic or a minor or major crisis, whenever the level of capital investment started to pick up again, the majority of it went to capital goods and development, not wages or contracts. The ATM is a fine example - when an economy is doing well enough, there are no pressures or external factors to pressure an increase in automation in order to save labor costs, but whenever things get shaky, a couple thousand positions get axed, when things started to look better again you just spend it on machines rather than hiring because it is more cost-efficient. Sure, the number of hires might seem stable, but those things happen in long scales. Hell, this is happening in China, which is where labor economic theory goes to die. Even if the Chinese labor reserve is so actually loving massive that models start making GBS threads themselves and puking purple, major industrial companies are pursuing automated solutions to be implemented during the next economic downturn.
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Dec 6, 2016 19:49
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