Creative destructrion

Question 1

What happens when investment in machinery increases?

Answer 1

investment in labour goes down
anything that makes a person productive – capital

Question 2

What happens when labour costs increase?

Answer 2

incentivises mechanization

Question 3

What is the source of productivity surge since mid-1990s?

Answer 3

IT

Question 4

What is the process of Creative destruction of work?

Answer 4

• Tech (capital) improves productivity
• Higher productivity per worker → reduces nr of workers required to achieve same
  output
• Machines can eradicate the need for human workers in particular occupations
• Creative destruction of work