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The article suggests that, despite popular belief, the large gains in
productivity during the 90's did not occur in the "New Economy", but
instead were mainly attributable to gains in the "Old Economy",
particularly durable goods manufacturing. The writer strongly criticizes
some of the metrics used to measure productivity gains in computer
technology, and suggests that, even in that sector, most of the gain, if
any, came from transfers of components between foreign countries
(particularly Asia), because overseas suppliers were unable to raise
prices. In the 90s there was unprecedented price stability of commodities
and raw materials.
"Statistically." he points out, "there is no difference between
productivity generated by brilliant innovations...or by squeezing lower
prices from labor and suppliers." He adds, however, that "The problem of
building wealth from economic inequity is that, eventually something bad
happens." If that occurs, he suggests that "the brunt of the hardship will
fall on the nation's temporary work force."
I would add that it is quite unlikely that any kind of measurable
productivity gain can be quantified in the dot.com economy. First, since
the vast majority of web pages are nothing but hype and junk, their value
is zero, thus the productivity of producing them is minus infinity.
Secondly, the dot.com economy hasn't been around long enough to establish
any kinds of benchmark productivity figures.
| Nullius in Verba |
Dan Emory, Dan Emory & Associates
FrameMaker/FrameMaker+SGML Document Design & Database Publishing
Voice/Fax: 949-722-8971 E-Mail: danemory -at- primenet -dot- com
10044 Adams Ave. #208, Huntington Beach, CA 92646
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