Whether it’s a good thing, and how good, depends on what happens to the people who had those jobs.
Imagine that there are a thousand people doing a horrible job for $20k/year. Now a machine of negligible cost comes along that can do the same job as one of them for $1k/year. Then, oversimplifying in some obvious ways, we have the following:
Option 1: Machines replace humans, workers take the benefits. Each of these people switches from doing the job for $20k/year to doing nothing for $19k/year. They’re better off, their employer is exactly the same as before. This is better for some people and not worse for anyone. Of course it will never happen.
Option 2: Machines replace humans, owners take the benefits. Each of these people switches from doing the job for $20k/year to doing nothing for $0k/year. Maybe they can find other jobs, maybe not. Their employer is just $19k/year per worker better off. This is better for some people (the owners of the business) but much worse for the employees, at least in the short term. It is quite likely to happen.
(In this case, what probably happens next—at least if there is competition—is that the company lowers its prices somewhat. So now the business owners win and their customers win. In the long run these lower prices may lead to new jobs.)
Option 3: Something in between. A union negotiates a special deal, or the government steps in in the hope of reducing unemployment and disaffection, or something. Exactly what happens will vary but it’s probably better for workers than 2 and worse than 1, better for owners than 1 and worse than 2, and probably a non-negligible fraction of the benefits get eaten up by administrative costs.
In the long run, all of these are probably better than leaving things as they are. In the short run—say, a few decades—option 2 (which is the most likely of the three, I think) means a thousand people out of work, and quite a lot of them may be unable to find other jobs. This may well be a bigger loss of net utility than the business owners’ gain in wealth.
If machines end up taking everyone’s jobs, that could be glorious (if it leads to lives of comfortable leisure for all) or terrible (if it leads to lives of comfortable leisure for people who are already wealthy enough not to need to work, and starvation for everyone else).
So: yes, a lot of jobs are pretty terrible and an optimal world without those jobs is much better than an optimal world with them. But we don’t have the option of either sort of optimal world, we only get worlds designed by Moloch, and the Moloch-world without those jobs may be even worse than the Moloch-world with them.
Then, oversimplifying in some obvious ways, we have the following:
A bit too much oversimplification for my taste. In particular, there is a rather important bit missing: what happens to the price of the products (or services) that these people produced. Let’s say they made widgets. In a market-based economy the price of the widgets would go down considerably and this will lead to a lot of extra consumer surplus for all buyers of widgets. This could easily be the most important effect and the greatest source of utility.
And because of that your option 2 is actually very unlikely to happen, other than in a monopoly-like situation, even in the short run.
In the long run, all of these are probably better than leaving things as they are.
There we go :-)
we only get worlds designed by Moloch
I don’t know about that. Moloch has to wrestle with the invisible hand of Adam Smith :-D and the world we are currently living in isn’t half bad, is it?
In particular, there is a rather important bit missing: what happens to the price of the products (or services) that these people produced.
Yeah, in retrospect I should have said something like
(In this case, what probably happens next—at least if there is competition—is that the company lowers its prices somewhat. So now the business owners win and their customers win. In the long run these lower prices may lead to new jobs.)
No, what happens is that the original producer plays a stock short on the new guy, does an M & A on them, then liquidates the new company while trapping any intellectual property and patents in the safe.
Then we lose competition, price pressure, and innovation.
Whether it’s a good thing, and how good, depends on what happens to the people who had those jobs.
Imagine that there are a thousand people doing a horrible job for $20k/year. Now a machine of negligible cost comes along that can do the same job as one of them for $1k/year. Then, oversimplifying in some obvious ways, we have the following:
Option 1: Machines replace humans, workers take the benefits. Each of these people switches from doing the job for $20k/year to doing nothing for $19k/year. They’re better off, their employer is exactly the same as before. This is better for some people and not worse for anyone. Of course it will never happen.
Option 2: Machines replace humans, owners take the benefits. Each of these people switches from doing the job for $20k/year to doing nothing for $0k/year. Maybe they can find other jobs, maybe not. Their employer is just $19k/year per worker better off. This is better for some people (the owners of the business) but much worse for the employees, at least in the short term. It is quite likely to happen.
(In this case, what probably happens next—at least if there is competition—is that the company lowers its prices somewhat. So now the business owners win and their customers win. In the long run these lower prices may lead to new jobs.)
Option 3: Something in between. A union negotiates a special deal, or the government steps in in the hope of reducing unemployment and disaffection, or something. Exactly what happens will vary but it’s probably better for workers than 2 and worse than 1, better for owners than 1 and worse than 2, and probably a non-negligible fraction of the benefits get eaten up by administrative costs.
In the long run, all of these are probably better than leaving things as they are. In the short run—say, a few decades—option 2 (which is the most likely of the three, I think) means a thousand people out of work, and quite a lot of them may be unable to find other jobs. This may well be a bigger loss of net utility than the business owners’ gain in wealth.
If machines end up taking everyone’s jobs, that could be glorious (if it leads to lives of comfortable leisure for all) or terrible (if it leads to lives of comfortable leisure for people who are already wealthy enough not to need to work, and starvation for everyone else).
So: yes, a lot of jobs are pretty terrible and an optimal world without those jobs is much better than an optimal world with them. But we don’t have the option of either sort of optimal world, we only get worlds designed by Moloch, and the Moloch-world without those jobs may be even worse than the Moloch-world with them.
A bit too much oversimplification for my taste. In particular, there is a rather important bit missing: what happens to the price of the products (or services) that these people produced. Let’s say they made widgets. In a market-based economy the price of the widgets would go down considerably and this will lead to a lot of extra consumer surplus for all buyers of widgets. This could easily be the most important effect and the greatest source of utility.
And because of that your option 2 is actually very unlikely to happen, other than in a monopoly-like situation, even in the short run.
There we go :-)
I don’t know about that. Moloch has to wrestle with the invisible hand of Adam Smith :-D and the world we are currently living in isn’t half bad, is it?
Yeah, in retrospect I should have said something like
… Oh, wait. I did.
No, what happens is that the original producer plays a stock short on the new guy, does an M & A on them, then liquidates the new company while trapping any intellectual property and patents in the safe.
Then we lose competition, price pressure, and innovation.
And even more folks are out of work.