Arthur wrote:
> At one point in my career at the Science Council I had 2 or
> sometimes more research assistants. Pouring through documents,
> collecting information, etc. Fast forward to the internet and
> Google. I could accomplish the same output with no research
> assistants. The increased productivity wasn't reflected anywhere in
> published economic data. In fact all the data showed were an
> increase in unemployment of two more people.
Don't take this personally, Arthur, but jeez, this is just the kind of
thinking that makes people scorn economists.
State #1: You, Bob and Alice are producing 1 groo of output per
annum.
State #2: You are producing 1 groo of output per annum.
But wait! The "system", the state of which we're observing, has been
changed by the observer. What happened to Bob and Alice? If they're
still part of the system, you have to account for productivity loss or
costs associated with their unemployment. If you exclude them from
the system, you're making a bogus measurement.
When I was in school, I worked a summer at the dairy science
department. We were running experiments on digestibility of feed
using rumen organisms in vitro -- little artificial
rumens-in-a-bottle, if you will.
My boss told me that the long-term goal of the dairy industry was a
tank of rumen organisms and a tank of bovine mammary tissue
culture. Throw hay into the rumen tank, pipe the effluent to the
mammary tank, drain high-buttterfat milk from the latter. Don't waste
any nutrients or energy on maintaining 1500 pounds of wasteful,
useless cow.
Well, that sort of thing is fine if you can leave some coal or oil in
the ground or leave some trees standing. Your "system" is a steam
engine or a paper machine and a few tweaks will make it use less coal
or pulp. That might even be okay for dairy science although it
offends me as bad art, bad karma, perverted systems thinking and
stupid in the long run.
But if you shitcan a couple of people and then say that your "system"
is more efficient due to their absence, you've committed an appalling
logical error. [1] In a purely abstract systems analysis, of course,
that would be perfectly correct. But economics isn't supposed to be
about purely abstract systems [2]. Economics is about social human
behavior. It shares with other social sciences a failure to get a
handle on what is probably the most complex system in the
universe. Worse, it tries to achieve this goal by simplifying human
behavior to just one or a handful of variables.
There are no "externalities". You can't throw anything "away" because
there is no "away". [3] Everybody is on the same bus. If we just
redefine our "system" as the million wealthiest folks and another 5 or
10 million (perhaps heavily armed) support staff, incomes will soar,
unemployment will plummet. Everything else is an externality, a black
box about which we know or care nothing except that it have specified
outputs for given inputs.
I know, I know, the notion is that if everybody does this,
"externalizes internal diseconomies", concentrates on "core
competencies", pursues "enlightened self-interest" etc. et buzzword
cetera, everything will somehow shake out for the best, to a Pareto
optimum. But I'll shingle out onto the fog here just a tad and say
that a Pareto optimum is, in a system a complex as the global (or
even, say, the Lunenburg County) economy, a dead end. An unadorned
hill-climbing algorithm leads to *local* optima and local optima may
be very bad -- very non-optimal -- indeed for many people or for
society in general.
That is, in fact (or at least in my estimation), the very problem
we're addressing here: the global financial, trade and business system
has achieved a local optimum. Contra Pareto, we've always allowed that
a putative improvement can disadvantage *some* people, a *few* people
(for rather overreaching and non-numerical values of "few") but now
we're confronted with a situation that is highly optimized for exactly
those who are in a position to control any proposed further
changes. We appear to be stuck on a local optimum hardly consistent
with socially desirable distribution of resources, equality, or the
overall well-being of society.
So: no problem with using Google and the net, just with using
"increased productivity" to describe it in the context given.
About bureaucracy "...it ceased to be merely a servant of
social institutions and became their master. Bureaucracy
now not only solves problems but creates them. More
important, it defines what our problems are - and they are
always, in the bureaucratic view, problems of efficiency."
"... this makes bureaucracies exceedingly dangerous,
because, though they were originally designed to process only
technical information, they now are commonly employed to
address problems of a moral, social, and political nature."
"... bureaucracy has broken loose from ....restrictions and
now claims sovereignty over all of society's affairs."
-- Technopoly, Neil Postman, 1992
- Mike
[1] The formal logicians must have a name for this error -- redefining
the system under consideration to allow the desired proposition to
become true -- but I don't know what it is. "Apalling error of
logic" seemed less infra dig than "flying up your own asshole".
[2] Although I infer that there are many academic economists who
think otherwise.
[3] Firing unwanted crap into orbit is not "away". It reqires
substantial computing power to keep track of stuff that has
already been thrown "away" up there and endangers orbital passers
by. Firing crap into interstellar space *might* be "away".
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