Tag: Duncan Weldon

Must-Read: Duncan Weldon: Five Thoughts on Brexit

Posted on by Brad DeLong

Must-Read: Duncan Weldon: Five Thoughts on Brexit:

  1. British politics now has a big dose of Syriza thinking. ‘Respect our democratic mandate’ doesn’t work when you’re dealing with 27 other democratically elected governments.
  2. I have no idea what the final settlement looks like. No one does.
  3. We won’t get any clarity in the next few months. The Tory leadership contest will at best give a small signal, but really it’s noise. The next PM will be selected by a membership of leave supporters and the candidates will pitch to that. All will offer a fantasy that the EU is unlikely to agree to.
  4. British politics is in flux. The next Tory leader faces having to make a tough choice: disappoint the membership and traditional Tory voters or lose the City. The broad coalition of social conservatives and economic liberals that form the party may not be able to survive this choice. Labour faces similar pressures. Handled badly, this go see a UKIP surge – not into power but into a much stronger position in Parliament.
  5. Finally – I think the UK’s actions will ultimately be good for EU unity. Others will be less inclined to follow our example if it is painful (and that’s without the additional problems of leaving Schengen or the euro). It isn’t hard to imagine the Eurozone doubling down now and building the kind of institutions that the zone needs to work.

Must-read: Duncan Weldon: “Fear of the robots is founded in the messy reality of labour”

Posted on by Brad DeLong

Must-Read: Duncan Weldon: Fear of the robots is founded in the messy reality of labour: “Dystopian visions of a future in which machines sweep millions of people out of work…

…are as old as technological change itself. What is missing from today’s debate about the march of the robots is an appreciation of the crucial role of labour bargaining power. When labour bargaining is weak, the Luddite fear of mechanisation is worth taking more seriously…. The best argument for being relaxed about this process is the long sweep of economic history itself…. But looking at the big picture risks missing important details….

To understand how the labour market reacts to labour-saving technology, economists tend to look at two related effects: the displacement effect and the compensation effect. The interaction of these processes determines how long a painful short run will last…. Labour market interactions are rarely the bloodless interplay of supply and demand lines on a graph. They are instead conditioned by the social and political context…. If labour’s bargaining position is weak, as it is currently, then the danger is that the higher productivity from new technologies will not sufficiently be captured in swift wage growth. Instead, it could flow to the owners of the technology…. Avoiding that unhappy outcome means recognising now that wage growth plays a crucial role in helping an economy through technological transitions and that labour bargaining power is a big part of it…

Must-Read: Duncan Weldon: Are the Robots Taking Enough Jobs?

Posted on by Brad DeLong

Must-Read: I find myself, more and more, wanting substantive integrated studies of the combination of market-firm, nonprofit and government, and within-household productivity. And I find myself less and less satisfied with current conventional GDP accounts as providing a good enough guide to what is really going on. So I am not satisfied with blanket declarations that productivity growth properly accounted-for is relatively slow:

Duncan Weldon: Are the Robots Taking Enough Jobs?: “We are transitioning to a world in which the global supply of labour…

…is less plentiful…. New workers will have to support a seemingly ever rising number of older, retired people…. It is possible to worry that the ‘robots’ aren’t taking enough jobs. That unless we see big increases in both labour-saving technology and in productivity, then the world faces a future of slower growth and an ever greater share of current workers’ incomes will be used to support the retired…

Must-Read: Duncan Weldon: Are the Robots Taking Enough Jobs?

Posted on by Brad DeLong
Actor Arnold Schwarzenegger poses for photographers at a preview of the film ‘Terminator: Genisys’. (AP Photo/Jacques Brinon)

Must-Read: Human smiles and human truly creative thought look to remain economically valuable. So learn how to smile!

Duncan Weldon: Are the Robots Taking Enough Jobs?: “Andy Haldane has warned that new technologies could replace up to 15 million British jobs…

…Ignazio Visco, trod much the same ground. Both policymakers are taking the threat of computerisation… seriously…. Historically… waves of new technology have created as many jobs as they have destroyed…. This time might be different, the next wave of labour-saving technology looks to be replacing human brains, rather than human brawn, and the impact could be far more wide-reaching. And, even if this time isn’t different… adjustments… in the past led to a generation or more of economic pain…