The future is here. Automation and robots are taking millions of jobs and promise to take millions more.
Larry Summers and Brad DeLong think that's good. David Ruccio, not so much.
I agree with Summers and DeLong that in real terms technological innovation is a benefit in that it increases efficiency, effectiveness and productivity overall. The benefits in real terms are enormous.
I also agree with Ruccio that this needs to be qualified. Like the terms of trade where imports are benefits in real terms with respect to goods, labor is disadvantaged by embedded labor that costs jobs and reduces pay. So the benefit in real terms only applies at full employment or if workers share in the gains with increased compensated leisure.
Curtailing technological innovation is Luddite and attempts to restrain material progress won't work. The actual issue is distribution of the surplus, was David Ruccio observes, and that needs to be revisited given emerging conditions that are resulting in challenges along with opportunities.
What's needed is innovation in thinking about distribution and also about work as a source of income in a market-based system in which distribution is rationed by price.
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David F. Ruccio | Professor of Economics, University of Notre Dame