Productivity

Labor productivity growth in the United States and other developed countries slowed from 1.9% in the 1990s to 1.3% from 2000 to 2008, coinciding with slackening growth in their per capita GDP.

Productivity growth in the world's developed economies since 2000 has been slower than in developing economies, according to the National Science Board. Faster productivity growth is critical as these nations cope with increasing numbers of retirees. And innovation, including the development and adoption of new technologies, is critical in spurring productivity. And, in contrast to what the conventional neoclassical economic doctrine holds, markets alone will produce societal sub-optimal levels of innovation.

Minimum Wage/Maximum Growth

February 20, 2013
| Blogs & Op-eds

In his State of the Union Address president Obama proposed that Congress increase the minimum wage to $9.00 per hour. Almost immediately a chorus of opposition based on neoclassical economics emerged, arguing that such a change would kill job creation. As former Bush Administration economist Greg Mankiw notes, “there is 79 percent agreement among his peers that a minimum wage increases unemployment among young and unskilled workers.” But let’s be clear, what Mankiw really means to say is a 79 percent agreement among neoclassical economists. The neoclassical economic argument against the minimum wage is grounded in the view that if a worker and employer agree on a wage then this wage level must be welfare maximizing for both of them and by definition for society. The only thing a government regulated price for labor can do is distort labor markets and lead to less, not more economic welfare. In fact, a higher minimum wage would spur economic growth, while also increasing economic fairness.

Postal Service Dares Congress on Plan Ending U.S. Saturday Mail

The San Francisco Chronicle
“It’s an assertion of leadership on the postmaster general’s part: ‘We’ve got to do this or we risk destroying the enterprise,’” said Rob Atkinson, president of the Information Technology and Innovation Foundation.

New Productivity Numbers Dispel Myth That Technology is Causing Job Loss

WASHINGTON (February 7, 2013) - New data from the Bureau of Labor Statistics (BLS) indicates that while domestic manufacturing jobs continue to decrease, productivity is actually going down. In its latest quarterly report released today, the BLS noted that productivity actually decreased 2 percent in the fourth quarter of 2012. Read more »

ITIF Calls End to Saturday Postal Service a ‘Step in the Right Direction’

WASHINGTON (February 6, 2013) – The Information Technology and Innovation Foundation (ITIF) applauded the United States Postal Service’s (USPS) announcement that it would be ending Saturday mail delivery. But ITIF argues more comprehensive reforms are required to address budget shortfalls and better align the agency with the needs of the Information Age. Read more »

I (Want) Robot

January 17, 2013
| Blogs & Op-eds

Automation, whether it's robots, computers, or machine tools, has never led to an increase in unemployment, and more importantly never will. Both history and scholarly analysis have clearly and consistently refuted the notion that increased productivity (through automation, self-service or robots) leads to higher unemployment in the moderate or long-term.

Walmart, Jobs and the Rise of Self-service Checkout Tech

Computerworld
Daniel Castro, a senior analyst at the Information Technology & Innovation Foundation, says whether the technology affects employment depends on how checkout kiosks are used.

Postal Delay in Congress Hastens Risk of Mail Stoppage

Bloomberg Businessweek
Rob Atkinson predicted that lawmakers will be forced into a last-minute deal later this year, as the Postal Service comes closer to running out of money and the public hears more about the prospect of an end to mail delivery.

In Chile, firms with greater ICT use achieved total factor productivity (TFP) 40 percent higher than those with lower ICT use.

ICTs are so powerful precisely because they enhance the productivity and innovative capacity of every individual, firm, and industry they touch throughout economies-and this holds true for developed and developing countries alike. In fact, ICT workers contribute three to five times more productivity than non-ICT workers. In Chile, firms with greater ICT use achieved total factor productivity (TFP) 40 percent higher than those with lower ICT use. ICT is just as vital to enabling innovation as to boosting productivity. Read more »

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