Rising income inequality has set off fierce political and economic debates, but one important angle hasn’t been explored adequately. We need to ask whether market forces themselves might limit or reverse the trend.
Technology has contributed to the rise in inequality, but there are also some significant ways in which technology could reduce it.
For example, while computers have improved our lives in many ways, they haven’t yet done much to make health care and education cheaper. Over the next few decades, however, that may well change: We can easily imagine medical diagnosis by online artificial intelligence, greater use of online competitive procurement for health care services, more transparency in pricing and thus more competition, and much cheaper online education for many students, to cite just a few possibilities. In such a world, many wage gains would come from new and cheaper services, rather than from being able to cut a better deal with the boss at work.
It is a bit harder to see how information technology can lower housing costs, but perhaps the sharing economy can make it easier to live in much smaller spaces and rent needed items, rather than store them in a house or apartment. That would enable lower-income people to live closer to higher-paying urban jobs and at lower cost.
Another set of future gains, especially for lesser-skilled workers, may come as computers become easier to handle for people with rudimentary skill. Not everyone can work fruitfully with computers now. There is a generation gap when it comes to manipulating electronic devices, and many relevant tasks require knowledge of programming or, more ambitiously, the entrepreneurial skill of creating a start-up. That, in a nutshell, is how our dynamic sector has concentrated its gains among a relatively small number of employees, thus leading to more income inequality.
This particular type of inequality may very well change. As the previous generation retires from the work force, many more people will have grown up with intimate knowledge of computers. And over time, it may become easier to work with computers just by talking to them. As computer-human interfaces become simpler and easier to manage, that may raise the relative return to less-skilled labor.
The future may also extend a growing category of employment, namely workers who team up with smart robots that require human assistance. Perhaps a smart robot will perform some of the current functions of a factory worker, while the human companion will do what the robot cannot, such as deal with a system breakdown or call a supervisor. Such jobs would require versatility and flexible reasoning, a bit like some of the old manufacturing jobs, but not necessarily a lot of high-powered technical training, again because of the greater ease of the human-computer interface. That too could raise the returns to many relatively unskilled workers.
The Latest on: Income inequality
[google_news title=”” keyword=”Income inequality” num_posts=”10″ blurb_length=”0″ show_thumb=”left”]
via Google News
The Latest on: Income inequality
- Opinion: How robots making your burger and fries can lead to greater income inequalityon May 1, 2024 at 3:01 am
Restaurants still need humans to do much of the labor. Working people deserve to have their voices heard in determining how, when or whether AI and automation should be used.
- Inequality in India greater today than at the height of the British Rajon April 26, 2024 at 4:49 pm
The top 1 percent of India’s population gorged on 22.6 percent of national income and 40.1 percent of national wealth in 2022-23.
- 5 reasons why Piketty and Pitroda’s arguments on income & wealth inequality are fanciful and flawedon April 26, 2024 at 4:26 am
The focus should be firmly on reducing the count of those defined as poor, rather than trying to bring down the numbers of wealthy in a flawed quest to establish a more equal society by taking away ...
- The 1990s Paradox (at Least to Some): Rising Income Inequality, Falling Concernon April 23, 2024 at 1:45 pm
Concerns about income inequality have become such a natural part of the national conversation that I worry we've stopped thinking about them in a serious, analytical way. Are popular views of the ...
- Global income inequality widens, World Bank issues stark warningon April 17, 2024 at 1:38 am
In a sobering report released on Monday, the World Bank underscored a troubling trend: the income gap between the world's wealthiest economies and th ...
- Income Inequality Up In 60% Of Nations With IMF, World Bank Loans: Reporton April 15, 2024 at 4:55 am
The Oxfam analysis revealed that income inequality is high in 42 countries, including Ghana, Honduras and Mozambique, and has risen in 37 countries over the past decade, including Burkina Faso ...
- Income inequality high or rising in 60 percent of countries with loans from IMF and World Bankon April 14, 2024 at 5:00 pm
Income inequality is high or increasing in 60 percent (64 out of 106) of low- and middle-income countries receiving grants or loans from the International Monetary Fund (IMF) and World Bank, reveals ...
- Economic wealth may be linked with happiness in China, if inequality is lowon April 9, 2024 at 5:00 pm
Higher income inequality was associated with reduced subjective well-being (a reduction of 1.47 units for every 0.09 unit increase in the Gini coefficient), and when it becomes too high (when the ...
- India’s Income Inequality Is Now Worse Than Under British Rule, New Report Sayson March 26, 2024 at 5:00 pm
A new study from the World Inequality Lab finds that the present-day golden era of Indian billionaires has produced soaring income inequality in India—now among the highest in the world and starker ...
- Reducing income inequality: An agenda in search of actionson March 23, 2024 at 1:01 am
Policymakers in developing countries must also react to this and focus on reducing income inequality. Take, for example, Bangladesh. The country's progress in terms of socioeconomic indicators ...
via Bing News
