Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.
PART 6 The Economics of Labor Markets
Chapter 18 of 36 The Markets for the Factors of Production
Section 10 of 20
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Over history, technological progress has been the worker's friend.
It has increased productivity, labor demand, and wages.
Yet workers sometimes see technological progress as a threat.
One famous example occurred in England in the early 19th century.
Skilled knitters saw their jobs threatened and eliminated by the invention and spread of weaving machines that could produce textiles using fewer skilled workers with much lower cost.
The displaced workers organized violent revolts against the new technology.
They smashed the weaving machines used in wool and cotton mills and set fire to the homes of some of the mill owners.
Because the workers were inspired by a mythical character “Ned Ludd” they were called Luddites.
The Luddites wanted the British government to save their jobs by restricting the spread of the new technology.
Instead, the Parliament took action to stop the Luddites.
Thousands of troops were sent to suppress the Luddite riots, and Parliament made destroying machines a capital crime.
After a trial in York in 1813, seventeen men were hanged for the offense.
Many others were convicted and sent to Australia as prisoners.
Today, the term Luddite refers to anyone who opposes technological progress.
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In what ways are restrictions on imports the same as restrictions on applying new production technologies?
ChatGPT:
Restrictions on imports and restrictions on new production technologies are similar because both block access to cheaper or more efficient ways of obtaining goods, which reduces overall economic welfare.
1. Reduced Efficiency
Import restrictions: Prevent firms and consumers from accessing lower-cost or higher-quality goods from abroad.
Technology restrictions: Prevent firms from adopting methods that lower production costs or raise productivity.
In both cases, society ends up producing at higher cost than necessary.
2. Higher Prices for Consumers
Import barriers (tariffs, quotas) reduce supply, pushing prices above the world-market level.
Technology bans, e.g., forbidding automation or genetically modified crops, force producers to use older, costlier methods, raising consumer prices.
Consumers pay more and buy less, creating deadweight loss (the amount of purchases not made due to the higher price).
3. Loss of Potential Gains from Trade/Innovation
Imports allow a country to specialize where it has comparative advantage.
Restrictions shrink the scope of gains from trade.
New technologies allow higher output from the same inputs.
Restrictions shrink the scope of gains from innovation.
4. Protection of Existing Producers
Both policies serve to protect incumbent firms or workers:
Import restrictions shield domestic producers from foreign competitors.
Technology restrictions shield workers or firms who might be displaced by innovation.
The protected group benefits, but at the expense of broader economic efficiency.
5. Deadweight Loss
In both cases, we see the same welfare results:
Supply is restricted
Price rises above the competitive level
Some mutually beneficial trades do not happen, creating deadweight loss.
Summary:
Import restrictions and technology restrictions are two sides of the same coin.
Both block access to cheaper production possibilities, raise costs, protect incumbents, and shrink consumer welfare.
The economy as a whole loses efficiency and output and deadweight loss is created, even if protected domestic producers and workers gain.
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In U.S. manufacturing what percent of jobs are lost due to advancing technologies and what percent due to increasing imports?
ChatGPT:
Comprehensive studies of trade and productivity conclude imports accounted for about 13% of job losses in manufacturing between 2000 and 2010, roughly 750,000 jobs.
The biggest contributor to manufacturing job losses has been productivity improvements and automation.
One analysis finds if productivity had remained constant from 2000 to 2010, the U.S. would have needed 20.9 million manufacturing workers to produce that year’s output—instead of just the ~12.1 million employed.
The difference of 8.2 million jobs reflects gains from technology and efficiency.
Concisely, it was manufacturing jobs lost due to
-imports caused 13% of the total job losses
-advancing technologies caused 83% of the total job losses
So, while trade-related losses are significant, the lion’s share—several million jobs—has been driven by technological change and rising productivity.
Bottom Line
Import competition has played a notable role, accounting for a minority share, commonly estimated at around 10–25% of manufacturing job losses.
But the major driver of the job losses has been automation and productivity improvements, leading to the majority—often estimated between 75% and 90%—of job losses in manufacturing.
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comprehensive studies
hōkatsu-tekina kenkyū
包括的な研究
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