Why the Internet is creating more value than jobs • Hacker News Board

Re: Why the Internet is creating more value than jobs

#11

Post by longarm » Thu, Feb 10, 2011, 11:04 PM UTC

mkramlich wrote: post #10

Because software and the Internet are making it easier to provide more value, more quickly and more cheaply, than ever before. Thus, less jobs needed. Plus more of the jobs that are needed can be done off-shore, or, on-shore but with less office space and commuting, which in turn drives down money that needs to be spent on those sectors as well. Also the increasing popularity of so-called Agile and MVP philosophies i…

But it is more than that. In my opinion there is kind of a nasty aversion in start up culture to permanence. Think food trucks vs opening a restaurant, outsourcing vs managing in house, renting a space vs building one, tele-commuting vs a vibrant office. It's not evil or anything, but in the aggregate I think it does lead to less commitment--building the type of foundation that other brick and mortar business do. Kind of a sad example is Amazon and their crazy Amazon Associates schemes to avoid paying taxes. Does it make sense from a maximizing shareholder value sense? Definitely. Does it maybe skirt some ethical obligations as a business and as people? Maybe.

Re: Why the Internet is creating more value than jobs

#12

Post by yakto » Thu, Feb 10, 2011, 11:04 PM UTC

prewett wrote: post #8

ximeng wrote: post #3

Well-written interesting article, and good links too: e.g. to this site on orbiting data centres: http://server-sky.com/

I would think that orbital data center would have some real problems with heat dissipation, since you can only cool via radiation in space. Terrestrial data centers already have a problem with heat, and they can cool via convection (which is what is ultimately going to cool those air-conditioners). And then there is the cost of lifting thousands of soon to be obsolete computers into orbit...

I'm not a scientist, but isn't it super cold in space, just above absolute zero? If you can keep the (direct and hot) sunlight off the boxes with reflectors, I'd think the ambient temperature would be far lower than anything attainable by earth-bound datacenter cooling systems, so therefore radiation would be a most excellent cooling system. In fact, you might have the opposite problem, and have to figure out how to reliably prevent the boxes from freezing when not exposed to sunlight.

Re: Why the Internet is creating more value than jobs

#13

Post by stretchwithme » Thu, Feb 10, 2011, 11:37 PM UTC

Technology makes a lot of manual work unnecessary. But the salaries that are saved are available to be spent on hiring people for other things.

Which is why mechanizing the farm didn't leave 80% unemployment in its wake.

The market for labor is like any other market. If prices are allowed to fluctuate, supply will continuously adjust to meet demand and vice-versa.

But if prices are kept artificially high, there will be a surplus. More workers will try to get the higher wages and jobs that are unprofitable for employers at the high price will not be filled.

You may not like, you may not even want to understand or acknowledge it, but this is how people behave in any market.

Re: Why the Internet is creating more value than jobs

#14

Post by kristianp » Fri, Feb 11, 2011, 1:17 AM UTC

The US may be stagnating, but China and the other members of the BRICS aren't. The USA needs to find an industry that will grow quickly and large enough to drive its whole economy. The Internet isn't going be that industry any more, as the greatest part of its growth has already happened.

Re: Why the Internet is creating more value than jobs

#15

Post by angstrom » Fri, Feb 11, 2011, 3:48 AM UTC

stretchwithme wrote: post #13

Technology makes a lot of manual work unnecessary. But the salaries that are saved are available to be spent on hiring people for other things. Which is why mechanizing the farm didn't leave 80% unemployment in its wake. The market for labor is like any other market. If prices are allowed to fluctuate, supply will continuously adjust to meet demand and vice-versa. But if prices are kept artificially high, there will…

While I agree that it frees up manual labor it raises another specter. The unskilled manual farm-hand labor shifted to unskilled manual manufacturing labor.

We're now telling people well past their prime to switch to more cerebral jobs because we've automated or outsourced the low-skill value added jobs and the pool of what's left drives down wages further due to all the people competing for them.

The problem is that we've increased productivity efficiencies and passed the savings onto the shareholders. A free market is efficient, not perfect.

Re: Why the Internet is creating more value than jobs

#16

Post by cwp » Fri, Feb 11, 2011, 4:05 AM UTC

joe_the_user wrote: post #9

"These pessimistic observations of long-term economic growth are in many ways a much needed splash of cold water in the face for the Kurzweilian "The Singularity is Near" crowd, the people who think nearly everything important has been growing exponentially." [emphasis added] For the "great stagnation" folks, apparently "everything important" is macro and that indeed, in a documentable way has not been growing expone…

Would define your use "macro" and "micro" here?

Re: Why the Internet is creating more value than jobs

#17

Post by stretchwithme » Fri, Feb 11, 2011, 4:19 AM UTC

angstrom wrote: post #15

stretchwithme wrote: post #13

Technology makes a lot of manual work unnecessary. But the salaries that are saved are available to be spent on hiring people for other things. Which is why mechanizing the farm didn't leave 80% unemployment in its wake. The market for labor is like any other market. If prices are allowed to fluctuate, supply will continuously adjust to meet demand and vice-versa. But if prices are kept artificially high, there will…

While I agree that it frees up manual labor it raises another specter. The unskilled manual farm-hand labor shifted to unskilled manual manufacturing labor. We're now telling people well past their prime to switch to more cerebral jobs because we've automated or outsourced the low-skill value added jobs and the pool of what's left drives down wages further due to all the people competing for them. The problem is that…

Frankly, I don't see how it is a problem. It is a continuous process in a developing economy. And its the process that makes capital available for all kinds of human investments.

I can assure you there is job security in a completely stagnant economy. But not very much capital for education, startups or mortgages, or freedom to live your life and take the risks that make it worth living.

Re: Why the Internet is creating more value than jobs

#18

Post by FD3SA » Fri, Feb 11, 2011, 5:42 AM UTC

cwp wrote: post #16

joe_the_user wrote: post #9

"These pessimistic observations of long-term economic growth are in many ways a much needed splash of cold water in the face for the Kurzweilian "The Singularity is Near" crowd, the people who think nearly everything important has been growing exponentially." [emphasis added] For the "great stagnation" folks, apparently "everything important" is macro and that indeed, in a documentable way has not been growing expone…

Would define your use "macro" and "micro" here?

I believe he is referring to the exponential increase in computations per dollar which has been ongoing for almost half a century. Furthermore, he refers to the massive industries which have sprung from this growth in computation (personal computing, telecom, entertainment, social networking, etc.).

This being said, there is a large divergence between exponential increase in computation and macroeconomic growth. The gains from computation have been highly consolidated (to a small number of extremely talented entrepreneurs not unlike our own HN community), whereas other major industries have stagnated or declined (housing, finance, manufacturing). I believe Tyler Cowen and his "Great Stagnation" sums it up nicely in that the net loss in those industries has been larger and more relevant macroeconomically than the relatively concentrated gains in Silicon Valley.

tl;dr: computation is fueling rapid new industries which create wealth, but that wealth is highly consolidated as it does not require labor to grow (labor required is replaced by computation). This causes economic stagnation for the great majority of the population (+/- 2 std dev of mean or 95%) who are unable to capitalize on the computational opportunities.

Re: Why the Internet is creating more value than jobs

#19

Post by joe_the_user » Fri, Feb 11, 2011, 6:05 AM UTC

FD3SA wrote: post #18

cwp wrote: post #16

Earlier quoted context omitted.

Would define your use "macro" and "micro" here?

I believe he is referring to the exponential increase in computations per dollar which has been ongoing for almost half a century. Furthermore, he refers to the massive industries which have sprung from this growth in computation (personal computing, telecom, entertainment, social networking, etc.). This being said, there is a large divergence between exponential increase in computation and macroeconomic growth. The…

"computation is fueling rapid new industries which create wealth"

I generally agree with your definition of my terms and your points. I would note that "Wealth" itself is a poorly defined term even compared other fuzzy economic terms. Micro-level technology is giving many people more range of actions than ever before but it's impact on measured economic wealth has been obscure.

A much larger portion of homeless people have cellphones today than ten years ago. But larger portion of people are homeless today than ten years ago - at least if you believe this is a recession.

If tomorrow, a chemical was released into the atmosphere which doubled the lifespan of everyone on earth, most would agree life would be improved. Yet no one would have a cent more money and it is actually hard to say what its impact on the economic system would be.

Re: Why the Internet is creating more value than jobs

#20

Post by borism » Fri, Feb 11, 2011, 9:21 PM UTC

joe_the_user wrote: post #19

FD3SA wrote: post #18

Earlier quoted context omitted.

I believe he is referring to the exponential increase in computations per dollar which has been ongoing for almost half a century. Furthermore, he refers to the massive industries which have sprung from this growth in computation (personal computing, telecom, entertainment, social networking, etc.). This being said, there is a large divergence between exponential increase in computation and macroeconomic growth. The…

"computation is fueling rapid new industries which create wealth" I generally agree with your definition of my terms and your points. I would note that "Wealth" itself is a poorly defined term even compared other fuzzy economic terms. Micro-level technology is giving many people more range of actions than ever before but it's impact on measured economic wealth has been obscure. A much larger portion of homeless peopl…

hard to say what its impact on the economic system would be

if lifespan of everybody doubled it would have devastating effect on world economy, as one of the most important issues we face today is population aging (and not just in developed world, but in China as well for example).