June 20, 2015

JOBS AS A SOCIAL INSTITUTION, NOT AN ECONOMIC ONE:

Will Humans Go the Way of Horses? : Labor in the Second Machine Age (Erik Brynjolfsson and Andrew McAfee, 6/16/15, Foreign Affairs)

In 1983, the Nobel Prize-winning economist Wassily Leontief brought the debate into sharp relief through a clever comparison of humans and horses. For many decades, horse labor appeared impervious to technological change. Even as the telegraph supplanted the Pony Express and railroads replaced the stagecoach and the Conestoga wagon, the U.S. equine population grew seemingly without end, increasing sixfold between 1840 and 1900 to more than 21 million horses and mules. The animals were vital not only on farms but also in the country's rapidly growing urban centers, where they carried goods and people on hackney carriages and horse-drawn omnibuses.

But then, with the introduction and spread of the internal combustion engine, the trend rapidly reversed. As engines found their way into automobiles in the city and tractors in the countryside, horses became largely irrelevant. By 1960, the United States counted just three million horses, a decline of nearly 88 percent in just over half a century. If there had been a debate in the early 1900s about the fate of the horse in the face of new industrial technologies, someone might have formulated a "lump of equine labor fallacy," based on the animal's resilience up till then. But the fallacy itself would soon be proved false: once the right technology came along, most horses were doomed as labor.

Is a similar tipping point possible for human labor? Are autonomous vehicles, self-service kiosks, warehouse robots, and supercomputers the harbingers of a wave of technological progress that will finally sweep humans out of the economy? For Leontief, the answer was yes: "The role of humans as the most important factor of production is bound to diminish in the same way that the role of horses . . . was first diminished and then eliminated."

But humans, fortunately, are not horses, and Leontief missed a number of important differences between them. Many of these suggest that humans will remain an important part of the economy. Even if human labor becomes far less necessary overall, however, people, unlike horses, can choose to prevent themselves from becoming economically irrelevant.

Indeed, the phenomenon that saw women and blacks added to the workforce without displacing any white males was a function of choice triumphing over economics.  But jobs had social cache at that point, and it was a triumph for women and blacks to obtain them.  The great question is can those who want to maintain this artificially inflated workforce in the face of economic pressures and the declining status associated with having a job.

Posted by at June 20, 2015 10:53 AM
  

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