Robots and the future of unemployment.

robots

robots

Piece up at The Atlantic: Robots and the Future of Unemployment, reacting to Gregory Clark’s Op-Ed. That Op-Ed has been taking it on the chin, rightfully in part because of it’s bizarre animus towards the poor/working class and hard determinism (with little to back it up) on the limits to education. But the idea that long-term nonemployment has been growing is in the data, and it’s hard to think of a story in which the new computerization of the economy isn’t playing a role. It’s not the only role of course; our prison and educational policies are also directing a large part of this. But the computerization part of the story will only grow with time.

Two Extra Points. 1) I talk about Los Angeles Plays Itself, one of my favorite movies. It’s a documentary about Los Angeles using only clips from movies set in Los Angeles with a narrator discussing their use of Los Angeles as both an object and a subject. Here’s a clip from it about modern architecture – it isn’t for everyone, but if you find it interesting it is worth tracking down (though it isn’t available on dvd).

2) Clark also wrote a paper with Marianne Page called Welfare Reform, 1834, which may influence his views about the standard micro “consequences” of government welfare and the pluses and minuses to a large welfare program for the poor:

The English Old Poor Law, which before 1834 provided welfare to the elderly, children, the improvident, and the unfortunate, was a bête noire of the new discipline of Political Economy. Smith, Bentham, Malthus and Ricardo all demanded its abolition. The Poor Law Amendment Act of 1834, drafted by Political Economists, cut payments sharply….

Despite the polemics of the political economists and pamphlet writers the Old Poor Law seemingly imposed little cost on land owners before 1834. It had no impact on rural wages, and was little barrier to labor mobility. Nor did it increase the fertility of the poor. The draconian reforms of the New Poor Law, in place in England until 1906, and dramatized by Charles Dickens in Oliver Twist in 1838, had no measurable social benefits.

Over the course of the nineteenth century hundreds of thousands of the poor in England were subjected to the harsh regime of the workhouse based on the mistaken conclusions of the Political Economists. Parents were separated from each other and their children, men and women were set to long hours of meaningless make work like breaking stones. The children in laboring families with the misfortune to produce large numbers of surviving children were brought up in conditions of grinding poverty.

Yet this deliberately induced suffering gained nothing for the land and property owners who funded poor relief. One of the first great triumphs of the new discipline of Political Economy, the reform of the Poor Laws, consequently had no effects on economic growth and economic performance in Industrial Revolution England. Political Economy was born in sin.

Interesting thoughts for those worried about extending unemployment benefits a few weeks during a recession.

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8 Responses to Robots and the future of unemployment.

  1. EW says:

    Mike, have you read A Farewell to Alms? I think Gregory Clark is better looking back than forward. Everyone needs a Malthusian streak.

  2. donthelibertariandemocrat says:

    From Amartya Sen in the FT:

    http://www.ft.com/cms/s/0/f8e0b1be-0ddc-11de-8ea3-0000779fd2ac.html

    “Despite all Smith did to explain and defend the constructive role of the market, he was deeply concerned about the incidence of poverty, illiteracy and relative deprivation that might remain despite a well-functioning market economy. He wanted institutional diversity and motivational variety, not monolithic markets and singular dominance of the profit motive. Smith was not only a defender of the role of the state in doing things that the market might fail to do, such as universal education and poverty relief (he also wanted greater freedom for the state-supported indigent than the Poor Laws of his day provided); he argued, in general, for institutional choices to fit the problems that arise rather than anchoring institutions to some fixed formula, such as leaving things to the market.”

    Maybe Clark & Page are talking about a different Adam Smith.

  3. Rob says:

    Polanyi’s lengthy meditation on the Speenhamland Law in The Great Transformation seems relevant to this discussion — in the early 19th century, he argues, “the economic advantages of a free labor market could not make up for the social destruction wrought by it.” Hence the Speenhamland law, which provided for a minimum income and prevented country folk from becoming proletarians even if it eventually encouraged pauperism as a career choice. It was an act of “reactionary paternalism” supposed to protect rural society from the dislocations of the industrial revolution, but instead brought moral ruin that horrified the emerging bourgeoisie. The growing pauperization, in Polanyi’s view, led to the merciless reforms of the 1830s that Clark notes, which brought a fully functioning labor market to fruition and made the “reserve army of the unemployed” and the “iron law” of subsistence wages a dismal reality.

    And I’d second the recommendation of Los Angeles Plays Itself, for what its worth.

  4. Crayfish says:

    Re unemployment among low-skilled workers. To what extent this is a problem for others than the workers and direct dependants is an intersting issue, and most likely results will vary between countries. Countries with a high minimum wage will have many people in this category and probably (otherwise the minimum wage level would be to vulnerable to black market practices) a social safety net that supports the level. A popular view is that differences in minimum wage levels explain many differences between Germany and its direct neigbours and the US Northeast and Midwest. In bothe cases densely populated mature industrial societies, but with an abundance of affordable gardeners, maintenance people and domestic help (not always with US residency papers). However, the few people who work in Germany are vastly more productive, although the work much shorter hours. Should I say more?

  5. Pingback: Westchester Lies « Taunter Media

  6. boondoggle says:

    If robots in the future wind up looking like Trisha Helfer and Grace Park, then I for one, welcome our future robot overlords.

  7. Polanyi’s lengthy meditation on the Speenhamland Law in The Great Transformation seems relevant to this discussion — in the early 19th century, he argues, “the economic advantages of a free labor market could not make up for the social destruction wrought by it.” Hence the Speenhamland law, which provided for a minimum income and prevented country folk from becoming proletarians even if it eventually encouraged pauperism as a career choice…..

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