Re: Re: RE: Re: Re: Did the boom benefit workers????
Dears James and Doug, I do agree with Doug. There is an overwhelming empirical evidence in favor of the hypothesis that exchange rate movements have contributed almost nothing to economic growth in the last decades. Kaldor, Thirlwall, and McCombie are good references on that. Hyperdeflation may have contributed somehow to rising productivity. However, in the last analysis, despite New Macroeconomists´ and monetarists' beliefs, the "successful" disinflation of the world economy has less to do with "smart" Central Banks' monetary policies than with the high-tech revolution. Ignacio At 03:01 p.m. 26/03/02 -0500, you wrote: >Devine, James wrote: > >>Is there any way that _measured_ productivity could grow due to a rising >>dollar exchange rate? > >Can't see how. A lot of the rise in productivity is the result of crazy >output growth in high-tech, because of the quality-adjusted price indexes. > >Doug
Re: Re: Did the boom benefit workers??? ?
[EMAIL PROTECTED] wrote: >Oh, and it'd cost no more to make a computer with a clockspeed of X than >it would one of Y, would it? Each might have cost as much as the other >to develop at the time, and I can't imagine plugging a pentium into a >motherboard (if that's where chips go, I wouldn't have the faintest) is >any harder than plugging in a 486. So some pentiums are called upon to >do stuff a 486 couldn't have done, but a lot are not. And only some of >that difference is a productive difference. How on earth would one find >the proportions and numbers in all this? > >Allowing for the fact I'm missing the point, You're not missing the the point - these are exactly the problems with the conventional hedonic pricing model for computers. As Robert Gordon pointed out somewhere, probably half but not fully in jest, much of the additional storage capacity in PCs is going to downloaded MP3s - an increase in utility, perhaps, but not "productive" in the boss's sense. Doug
Re: Did the boom benefit workers??? ?
G'day Doug, > Devine, James wrote: > > >is there something about counting software as if it were a physical > >investment (and thus part of output and the numerator) that distorts > >productivity numbers? > > Shouldn't, much, though no one knows how to adjust it for quality > either. It does enter into the growth accounting games that are the > supposedly rigorous evidence for the productivity burst (e.g. Oliner > & Sichel and Jorgenson & Stiroh). > > I see no conceptual reason why software shouldn't be considered an > investment - without it, computers are useless, and it lasts a long > time. Software is definitely investment, but it's been a very regular investment, no? Where I work, people are always getting perfectly functional computers or software suites whipped off their desks and replaced - loads of labour, living and dead, goes into this artificial cycle. If that experience is generalisable, we'd be talking high profits and productivity (which number depends on what price increases you manage squeeze out of your customers as much as it does on your plant and labour costs) for computer, software and corporate network consultancy firms and lower-than-necessary numbers everywhere else. Ain't that what the likes of Gordon and Preissl found in the 90s? Here at home, my Mac is 9 years old and so is the software that came with it. I type just as slowly on this as I do on the one at work, and get my e-mails at exactly the same speed (although Michael Keaney and Charles Brown's posts don't come wrapped). So, yeah, software does last a long time - as long as it takes you to replace it. And the pentium may be faster than the 486, but it's the 286 chip that's embedded in much of our electricity network - it'd run no better with a pentium, would it? Oh, and it'd cost no more to make a computer with a clockspeed of X than it would one of Y, would it? Each might have cost as much as the other to develop at the time, and I can't imagine plugging a pentium into a motherboard (if that's where chips go, I wouldn't have the faintest) is any harder than plugging in a 486. So some pentiums are called upon to do stuff a 486 couldn't have done, but a lot are not. And only some of that difference is a productive difference. How on earth would one find the proportions and numbers in all this? Allowing for the fact I'm missing the point, Rob.
RE: Re: RE: Re: Re: Did the boom benefit workers????
I wrote: > >Is there any way that _measured_ productivity could grow due > to a rising > >dollar exchange rate? Doug answers: > Can't see how. A lot of the rise in productivity is the result of > crazy output growth in high-tech, because of the quality-adjusted > price indexes. is there something about counting software as if it were a physical investment (and thus part of output and the numerator) that distorts productivity numbers? JD
Re: Re: Did the boom benefit workers????
Sabri Oncu wrote: >Let me add one more question. How does one measure productivity >in a heavily service based economy? It ain't easy, to say the least. But it's not that easy to measure the 'real' value of computers either. The standard technique is essentially that a computer with a clock speed of 800 is twice the machine of one with a 400 clock speed. But there's not much evidence that that translates into twice as much usable output. If you're just typing letters or writing papers, it hardly makes any difference. And what happens if the value of the 800 machine craters because 1200s are introduced? Does its real value fall proportionally? Doug
Re: RE: Re: Re: Did the boom benefit workers????
Devine, James wrote: >Is there any way that _measured_ productivity could grow due to a rising >dollar exchange rate? Can't see how. A lot of the rise in productivity is the result of crazy output growth in high-tech, because of the quality-adjusted price indexes. Doug
Re: Did the boom benefit workers????
Let me add one more question. How does one measure productivity in a heavily service based economy? Sabri > Michael Perelman wrote: > > Calling Dr. Henwood. Doug could the causality have been > different? The implosion of Dot.coms and the like caused profits to fall, > while wages, a lagging element in most cycles, sputtered along for a while? Dr. Hewood responds: > The weird thing about all this is that profits fell just as > productivity was accelerating. If productivity were so spectacular, > and ULC falling at a correspondingly rapid pace, why was there a > profit squeeze? Further evidence that the productivity stats are > questionable, I'd say. Is there any way that _measured_ productivity could grow due to a rising dollar exchange rate? Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
Re: Re: Did the boom benefit workers????
Michael Perelman wrote: >Calling Dr. Henwood. Doug could the causality have been different? The >implosion of Dot.coms and the like caused profits to fall, while wages, a >lagging element in most cycles, sputtered along for a while? The weird thing about all this is that profits fell just as productivity was accelerating. If productivity were so spectacular, and ULC falling at a correspondingly rapid pace, why was there a profit squeeze? Further evidence that the productivity stats are questionable, I'd say. Doug
Re: Did the boom benefit workers????
Calling Dr. Henwood. Doug could the causality have been different? The implosion of Dot.coms and the like caused profits to fall, while wages, a lagging element in most cycles, sputtered along for a while? "Devine, James" wrote: > it's interesting that according to Mandel, (1) wages squeezed profits during > the late 1990s and (2) "the income gap between rich and poor did continue to > widen." Is that mostly due to tax-law changes? or because of a thinning out > of the ranks of the almost-rich? or what? > > Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > > > -Original Message- > > From: Carl Remick [mailto:[EMAIL PROTECTED]] > > Sent: Tuesday, March 26, 2002 5:04 AM > > To: [EMAIL PROTECTED] > > Subject: [PEN-L:24340] Re: Did the boom benefit workers > > > > > > >From: Michael Perelman <[EMAIL PROTECTED]> > > > > > >APRIL 1, 2002/BusinessWeek > > > > > >Restating the '90s > > > > > >By Michael Mandel. > > > > > >We now have enough perspective to look back at the last decade and > > >assess > > >what was real--and what wasn't. > > > > > >[Much cheerful blah, blah] > > > > > >That said, the income gap between rich and poor did continue > > to widen ... > > > > Journalists call this "burying your lead." > > > > Carl > > > > _ > > Get your FREE download of MSN Explorer at > > http://explorer.msn.com/intl.asp. > > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
RE: Re: Did the boom benefit workers????
it's interesting that according to Mandel, (1) wages squeezed profits during the late 1990s and (2) "the income gap between rich and poor did continue to widen." Is that mostly due to tax-law changes? or because of a thinning out of the ranks of the almost-rich? or what? Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > -Original Message- > From: Carl Remick [mailto:[EMAIL PROTECTED]] > Sent: Tuesday, March 26, 2002 5:04 AM > To: [EMAIL PROTECTED] > Subject: [PEN-L:24340] Re: Did the boom benefit workers > > > >From: Michael Perelman <[EMAIL PROTECTED]> > > > >APRIL 1, 2002/BusinessWeek > > > >Restating the '90s > > > >By Michael Mandel. > > > >We now have enough perspective to look back at the last decade and > >assess > >what was real--and what wasn't. > > > >[Much cheerful blah, blah] > > > >That said, the income gap between rich and poor did continue > to widen ... > > Journalists call this "burying your lead." > > Carl > > _ > Get your FREE download of MSN Explorer at > http://explorer.msn.com/intl.asp. >
Re: Did the boom benefit workers????
>From: Michael Perelman <[EMAIL PROTECTED]> > >APRIL 1, 2002/BusinessWeek > >Restating the '90s > >By Michael Mandel. > >We now have enough perspective to look back at the last decade and >assess >what was real--and what wasn't. > >[Much cheerful blah, blah] > >That said, the income gap between rich and poor did continue to widen ... Journalists call this "burying your lead." Carl _ Get your FREE download of MSN Explorer at http://explorer.msn.com/intl.asp.
