Outsourced Jobs Are No Longer Cheap, So They're Being Automated • Hacker News Board

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#91

Post by mrow84 » Thu, Oct 09, 2014, 2:41 PM UTC

yummyfajitas wrote: post #89

mrow84 wrote: post #88

Earlier quoted context omitted.

> With more consumption and less investment, we expect the economy to increase more slowly than in the counterfactual (no BI). So holding money supply constant (which is of course ridiculous), we'd expect more inflation in the BI scenario than the no BI scenario. Yes, I agree that it seems like there would be more inflation with BI than without it, though, as I said, that will be irrelevant in policy terms as long as…

I think the answer to this question comes from the fact that BI is a policy designed to alter the distribution of wealth, rather than the overall level of wealth. The issue here is not distribution of wealth, it's consumption. The more we consume now, the less we invest in the future. Do you disagree that BI will increase consumption? Concretely, we could invest in reducing CO2 emissions, building Tesla factories or…

> The issue here is not distribution of wealth, it's consumption. The more we consume now, the less we invest in the future. Do you disagree that BI will increase consumption?

The point of BI is to redistribute consumption to the lower end of the economic distribution, at the expense of the higher end, not to increase overall consumption, though that might happen as a side effect.

The net increase in consumption minus the net productivity gains will be the cost of BI, paid to increase economic equality. However, I have seen quite a few (in fact I would say most) proponents of BI argue that the "cost" will be negative, that the productivity gains will, overall, exceed the increase in consumption.

A basis for this claim is that the marginal return on consumption for poorer people is higher than for richer people, and so they can more efficiently use the redistributed consumption, leading to higher overall productivity. The issue of consumption is, therefore, only half of the argument, and must always be considered in tandem with productivity.

The answer to your final question in this context is that we should favour BI because it is intended to increase net productivity at the same time as increasing consumption on the low end: we will have our cake and eat it.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#92

Post by julie1 » Thu, Oct 09, 2014, 3:05 PM UTC

CmonDev wrote: post #51

julie1 wrote: post #33

People are not tired of this kind of FUD? Whatever you do good devs are a limited resource, and all that is made to try to walk around the problem worsen it: - outsourcing ? => You have to compensate in supervision and you lose in quality. (Indians are not bad coders, but there is something called the Babel tower effect that creates a lot of signal perturbation/costs) - agile? => Trying to cut on correctness and deta…

"...if only people were not starving in the streets..." You have a bigger problem with IT then investment banking and international politics? I am personally very happy that once in a while engineers are getting a kind of fair deal. Of course let's not forget that salaries in Silicon Valley were artificially suppressed for a while in an illegal agreement between the likes of Google and Apple. So being underpaid is wh…

We are getting paid peanuts compared to the unfair captation of our values through Intellectual Property.

Let me be clear: we are undervalued by our companies, and overvalued when sold to the customers. Have you looked at apples/googles net (official) margin? 20+% Stuff like Danone are 5%. And They have incentive to underestimate their profit for paying less taxes.

A coder is like 40% ROI once you set your monopole.

The only merit of a boss? Being bornt wealthy, and then all he is doing is walking into the open like Riquet with the tuft. http://en.wikipedia.org/wiki/Riquet_with_the_Tuft

He can act as a jerk, be an asshole, but everybody gives him the credit of the employees real value, and of course the real benefits.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#93

Post by infinite8s » Thu, Oct 09, 2014, 3:57 PM UTC

xerophyte12932 wrote: post #44

teebs wrote: post #37

Earlier quoted context omitted.

From my understanding of this issue, that money is "owned" by the Apple stockholders, and is incorporated into the company's stock price. If a corporation has a lot of money, its shareholders have that money. Same with anything else the company owns--buildings, equipment, etc.

From my understanding, all the capital (money) and other assets (equipment etc) all belong to Apple, where Apple isn't just "a group of people", but is an entity in itself. To make it clearer, if apple has $150 Billion cash lying around, none of the stockholders can just withdraw some of it, or even their percentage share of it. What they can do is sell their "share", where the share itself can be considered a separa…

They could also all get together (a shareholder meeting) and vote in a board of directors who would then agree to disburse that capital to shareholders as dividends. It's not quite as direct as going to an ATM and taking out cash, but there are mechanisms for the shareholders to reclaim some of the 'locked-in' value.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#94

Post by infinite8s » Thu, Oct 09, 2014, 4:12 PM UTC

mrow84 wrote: post #91

yummyfajitas wrote: post #89

Earlier quoted context omitted.

I think the answer to this question comes from the fact that BI is a policy designed to alter the distribution of wealth, rather than the overall level of wealth. The issue here is not distribution of wealth, it's consumption. The more we consume now, the less we invest in the future. Do you disagree that BI will increase consumption? Concretely, we could invest in reducing CO2 emissions, building Tesla factories or…

> The issue here is not distribution of wealth, it's consumption. The more we consume now, the less we invest in the future. Do you disagree that BI will increase consumption? The point of BI is to redistribute consumption to the lower end of the economic distribution, at the expense of the higher end, not to increase overall consumption, though that might happen as a side effect. The net increase in consumption minu…

I believe the gp is saying that BI won't cause a redistribution of consumption from the high-end to the low-end, but instead of redistribution of investment on the high-end (since consumption doesn't scale linearly with income - probably something logrithmic looking), and this loss of investment will have a much greater negative effect on productivity than any minor increase due to consumption on the low end.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#95

Post by AnthonyMouse » Thu, Oct 09, 2014, 4:40 PM UTC

yummyfajitas wrote: post #47

AnthonyMouse wrote: post #45

Earlier quoted context omitted.

> how these monies will be collected Taxation. > what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) A basic income removes the need for a long list of bureaucratic social programs like social security, food stamps, housing assistance, pell grants, etc. etc. It's the free market solution for social welfare programs. You allow individuals to decide…

Inflation comes from increasing the money supply faster than the size of the economy increases. This is a strange Austrian definition and is not widely accepted. The normal definition of inflation is increases in the value of a basket of consumption. CPI is a good proxy for this over the short term (in the long term CPI becomes useless for this purpose since the basket changes). If BI increases demand for consumption…

> If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation.

This is a very bizarre argument against BI. You can clearly see how silly it is by applying it to reducing the unemployment rate (or for that matter anything that provides income to the poor) -- if more people have income then consumption will increase and cause inflation.

The reason the argument is silly is that it's way more complicated than that. Even the assumption that BI will cause increased consumption is based on other assumptions about what people want at different income levels. It could be that members of the lower middle class are hungry for an opportunity to start a business and will use the money to invest rather than consume. It depends entirely on the contours of the economy at a specific time and place and is constantly in flux. Investment vs. consumption is also a false dichotomy, because investments just turn into the consumption of the entity selling the investment, and businesses obtain capital by selling products as well as by soliciting investors. So it's really the difference between consumption of consumer goods and services like food and entertainment vs. of business goods and services like commercial equipment and marketing services, and even that distinction is as clear as mud.

On top of that, whether an increase in demand causes an increase in price depends on the supply of the goods in question. There are many products for which this relationship is negative. Where there is no practical limit on the number of units suppliers can produce, having more demand will give sellers more units over which to amortize fixed costs and can thereby reduce the unit price.

This makes the statement "basic income will cause inflation" completely meaningless. What it will do is cause the price of some goods and services to increase and others to decrease, much as any economic change will do. Whether this change will on net cause prices to increase more than decrease (and to what degree) depends entirely on the contours of the economy and on which specific goods and services you're measuring.

But perhaps most importantly, even assuming it would cause inflation in a particular economy, the amount of inflation is necessarily less than the amount of the basic income because of the existence (and likely preponderance) of products with less than perfectly inelastic supply.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#96

Post by AnthonyMouse » Thu, Oct 09, 2014, 4:59 PM UTC

yummyfajitas wrote: post #86

mrow84 wrote: post #83

Earlier quoted context omitted.

Inflation is measured by an increase in the price of a basket of consumption, not the value, which is almost unmeasureable. If the size of the economy increases faster than the increase in the money supply then there is a greater demand for money to buy all the new stuff being produced, so money is more valuable, therefore you can buy more with your money, ergo prices fall; all taken with the same amount of handwavin…

You are correct, I should have said "price" instead of "value". Everything you say about the boundedness of the consumption increase is correct. So we'll get a one time inflation spike. The main issue I take with your post is this: If the size of the economy increases faster than the increase in the money supply... With more consumption and less investment, we expect the economy to increase more slowly than in the co…

> The real question here, which is more or less unrelated to inflation: why do we want to shift resources from investment to consumption?

Putting aside the question of whether a basic income would actually shift resources from investment to consumption, there is a very simple way to offset it. Raise the money using a consumption tax (ideally VAT).

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#97

Post by yummyfajitas » Thu, Oct 09, 2014, 5:06 PM UTC

AnthonyMouse wrote: post #95

yummyfajitas wrote: post #47

Earlier quoted context omitted.

Inflation comes from increasing the money supply faster than the size of the economy increases. This is a strange Austrian definition and is not widely accepted. The normal definition of inflation is increases in the value of a basket of consumption. CPI is a good proxy for this over the short term (in the long term CPI becomes useless for this purpose since the basket changes). If BI increases demand for consumption…

> If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation. This is a very bizarre argument against BI. You can clearly see how silly it is by applying it to reducing the unemployment rate (or for that matter anything that provides income to the poor) -- if more people have income then consumption will increase and cause inflatio…

You can clearly see how silly it is by applying it to reducing the unemployment rate...

Reducing unemployment will increase demand but will also increase supply. So no.

It could be that members of the lower middle class are hungry for an opportunity to start a business and will us the money to invest rather than consume...There are many products for which this relationship is negative. Where there is no practical limit on the number of units suppliers can produce...

So if I'm understanding you right, BI will work because the rich have a higher marginal propensity for consumption, Giffen goods are common and scarcity isn't real? Ok.

It depends entirely on the contours of the economy at a specific time and place and is constantly in flux.

If that is the case then the usefulness of a BI will also constantly be in flux. I guess your opinions on the topic are also constantly in flux? If not, why not?

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#98

Post by AnthonyMouse » Thu, Oct 09, 2014, 5:48 PM UTC

yummyfajitas wrote: post #97

AnthonyMouse wrote: post #95

Earlier quoted context omitted.

> If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation. This is a very bizarre argument against BI. You can clearly see how silly it is by applying it to reducing the unemployment rate (or for that matter anything that provides income to the poor) -- if more people have income then consumption will increase and cause inflatio…

You can clearly see how silly it is by applying it to reducing the unemployment rate... Reducing unemployment will increase demand but will also increase supply. So no. It could be that members of the lower middle class are hungry for an opportunity to start a business and will us the money to invest rather than consume...There are many products for which this relationship is negative. Where there is no practical lim…

> Reducing unemployment will increase demand but will also increase supply. So no.

That's just the same fallacy. Why can you assume the thing the employee is producing won't have less price elasticity than the thing the employee buys with the income, but I can't?

> the rich have a higher marginal propensity for consumption

Your argument is that the rich have a much lower marginal propensity for consumption, enough to really matter. And that may even be true if you're talking about a matter of $2, which a poor person would almost certainly use to buy lunch or the like but would have no effect on a rich person's level of consumption. But if you give a poor person $20,000, now you have to ask whether they aren't going use it to attend college or start a business. It's an entirely different dynamic.

Also, if the money is raised using a consumption tax then it can inherently never come from someone making an investment regardless of their income level, which kind of destroys your entire argument, since it is based on where the money comes from as much as who gets it.

> Giffen goods are common

Nobody is even talking about Giffen goods, that's the demand side. And goods whose total cost is dominated by fixed costs are extremely common.

> scarcity isn't real

Scarcity is often not relevant. The market price of a computer or pharmaceuticals or recorded music is completely divorced from the cost of the scarce materials necessary to manufacture it. There is no realistic volume of DVDs that could be produced that would materially affect the market price of plastic.

> If that is the case then the usefulness of a BI will also constantly be in flux.

Whether and to what degree it causes inflation or deflation would constantly be in flux. That it might possibly cause a small amount of inflation is hardly a condemnation, and it is unlikely to cause a large amount of inflation for the reasons I've already mentioned -- its tendency to increase prices in some products is offset by its tendency to reduce prices in other products.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#99

Post by anigbrowl » Thu, Oct 09, 2014, 8:14 PM UTC

eli_gottlieb wrote: post #70

anigbrowl wrote: post #30

Earlier quoted context omitted.

Very possibly, but proponents of a basic income consistently fail to articulate three things: how these monies will be collected, what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) and why it won't be inflationary.

>what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) So that we can reduce work pressure and people can have fun with their lives instead of struggling for a living in a world of plenty. I mean, DUH . Why does this even need to be stated in the first place?

That's why I would like a basic income, but it won't wash with most people. Perhaps I should have said 'individual rationale'. Look at it from a conservative point of view (becuase that's where the opposition will come from): why should my hard-earned taxes be used to give people money for doing nothing, just so that they can 'have fun with their lives'?

This isn't my personal outlook, but I'm playing devil's advocate here.

Re: Outsourced Jobs Are No Longer Cheap, So They're Being Automated

#100

Post by 123testaccount » Thu, Oct 09, 2014, 9:10 PM UTC

anigbrowl wrote: post #99

eli_gottlieb wrote: post #70

Earlier quoted context omitted.

>what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) So that we can reduce work pressure and people can have fun with their lives instead of struggling for a living in a world of plenty. I mean, DUH . Why does this even need to be stated in the first place?

That's why I would like a basic income, but it won't wash with most people. Perhaps I should have said 'individual rationale'. Look at it from a conservative point of view (becuase that's where the opposition will come from): why should my hard-earned taxes be used to give people money for doing nothing, just so that they can 'have fun with their lives'? This isn't my personal outlook, but I'm playing devil's advocat…

You parent's argument is poorly stated if the desire is to appeal to conservatives. Indeed, many people will object for the reason you stated.

There are a few premises that must be established to make a case for BI.

1. We are approaching a post-scarcity economy.

2. In a post-scarcity economy, many people will lose the ability to support themselves\their families, as whole industries are automated.

3. In the case of massive unemployment, consumption will drop dramatically.

4. Drastic drops in consumption will devastate the economy. This will be bad for everyone. Less wealth, less progress, less investment.

5. Therefore, to maintain economic growth/stability in a post-scarcity economy, we should provide a basic income.

That's the best argument I can formulate. It really has nothing to do with having fun and not being forced to do menial work. Those are fringe benefits.