The Robots Are Coming

Great article that catalogues, in a digestible format, the economic trajectory of humanity and the increasing importance of technology (and capital) in generating economic output. In a Caldor-Hicks economic framework, where output is a function of labor and capital, the importance of human labor is diminishing in relative importance to that of capital.

 In 1960, the most profitable company in the world’s biggest economy was General Motors. In today’s money, GM made $7.6 billion that year. It also employed 600,000 people. Today’s most profitable company employs 92,600. So where 600,000 workers would once generate $7.6 billion in profit, now 92,600 generate $89.9 billion, an improvement in profitability per worker of 76.65 times. Remember, this is pure profit for the company’s owners, after all workers have been paid. Capital isn’t just winning against labour: there’s no contest. If it were a boxing match, the referee would stop the fight.

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