21.7 C
Tuesday, July 16, 2024

Economists are increasingly blaming technological advancements for rising inequality

MIT economist Daron Acemoglu has been arguing against what he refers to as “excessive automation” for some time now.

MIT economist Daron Acemoglu has been arguing against what he refers to as “excessive automation” for some time now.

According to some of his latest studies, the rising pay disparity between men and women in the United States during the past 40 years may be attributed to the automation of jobs that were formerly performed by human employees, particularly males without college degrees, during that time period.

Globalization and the decline of labour unions have both had a part in this development. Nevertheless, Mr. Acemoglu believes that automation is the most crucial aspect. Furthermore, inequality exacerbated by automation is “not a result of God or nature,” he stressed. This is the outcome of decisions that companies and society as a whole have made about how to use technology.”

Mr. Acemoglu, a well-known scholar whose work has earned him the distinction of being one of the most frequently cited economists in academic journals, is far from the only prominent economist who believes that computerised machines and software, with a little help from policymakers, have played a significant role in widening the income disparities in the United States. Their numbers are increasing, and their voices are adding to the cacophony of criticism directed at the Silicon Valley behemoths and the unbridled advancement of technology.

For his work on technical innovation and economic development, Paul Romer received the Nobel Prize in economic science in 2010. In recent years, he has voiced concern about the increasing market strength and influence of large technology corporations. “Economists were taught that the market is the solution.

Several steps, ranging from nudges for entrepreneurs to tax changes to pursue “labor-friendly innovations,” have been proposed in a paper by Anton Korinek, an economist at the University of Virginia, and Joseph Stiglitz, a Nobel Prize-winning economist at Columbia University, entitled “Steering Technological Progress.”

Mr. Brynjolfsson said that the Turing test, which involves matching human performance, has been the driving metaphor for engineers, entrepreneurs, and legislators when thinking about artificial intelligence for decades. As a result, artificial intelligence systems are being developed that are intended to replace employees rather than to improve their performance. “I believe that was a mistake,” he said.

It is becoming increasingly popular in Washington to pay heed to the concerns highlighted by these economists at a time when the major technology corporations are already being targeted on a number of fronts. Officials often criticise the businesses for failing to do more to safeguard users’ privacy and for amplifying disinformation, according to the officials. Democrats are attempting to limit the market dominance of the industry’s largest businesses via new legislation, as seen by cases filed in state and federal courts against Google and Facebook for allegedly breaking antitrust rules.

At a hearing in November on technological innovation, automation, and the future of labour, Mr. Acemoglu spoke before the House Select Committee on Economic Disparity and Fairness in Growth on his experiences as a venture capitalist. The committee, which began meeting in June and will continue to meet and collect evidence for a year, will then submit its findings and recommendations to the House of Representatives.

Acemoglu, on the other hand, believes that a laissez-faire, free-market approach is a formula for increasing inequality, as well as all of the social evils that go along with it. He believes that providing appropriate tax treatment for human work is a crucial legislative step to take. Labour is subject to a 25 percent tax rate, which includes payroll taxes and federal income taxes. Following a succession of tax reductions, the current rate on the costs of equipment and software is close to 0 percent.

In order to prepare students for the occupations of the future, Mr. Acemoglu believes that well-designed education and training programmes are important. However, he feels that technological advancement should be guided in a more “human-friendly manner.” Inspired by the growth of renewable energy over the previous two decades, which has been aided by government research, production subsidies, and public pressure on companies to decrease carbon emissions, he has developed his own renewable energy technology.

Jonathan James
Jonathan James
I serve as a Senior Executive Journalist of The National Era
Latest news
Related news


Please enter your comment!
Please enter your name here