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
via Google News
The Latest on: Income inequality
- South Africa’s income inequality is particularly unevenon November 18, 2019 at 3:53 am
“The poor won’t go to Limpopo for instance, because it is poor, but going to a rich province improves their chances, while at the same time widening the inequality gap.” Income inequality means that a ...
- Seattle Mayor Jenny Durkan to speak at Seattle U on homelessness, income inequalityon November 15, 2019 at 7:24 pm
Mayor Jenny Durkan is scheduled to speak about the cost of living in Seattle, homelessness, income inequality and environmental sustainability Monday night at Seattle University. The event on November ...
- Income inequality worsens for black Africans, improves for whites and Indianson November 14, 2019 at 4:43 am
He said while economic inequality had decreased for Indians/Asians and whites, it remained fairly constant for coloureds and increased for black Africans. Income from the labour market has ...
- The Finance 202: Why income inequality is such a huge topic for 2020 candidates — and investorson November 12, 2019 at 4:59 am
Inequality “is coming more and more to the surface… We believe these multi-decade ... That’s in part because the top 1 percent now pulls down nearly twice as much income as the bottom 50 percent: And ...
- The problem with income inequality is not CEO pay — it's everybody else's, Jim Cramer sayson November 11, 2019 at 9:00 pm
"If he were a free agent, he'd be making a heck of a lot more than he's making now," the "Mad Money" host says, while acknowledging the issue of income inequality in America. "Income inequality is a ...
- CEO pay not to blame for income inequality in America, says Jim Crameron November 11, 2019 at 4:18 pm
"Income inequality is a real problem in this country … but the problem is not CEO pay. I think it might be everybody else's pay," the "Mad Money" host says. The Wall Street Journal. Like us on ...
- Jamie Dimon says income inequality is a 'huge problem' but don't 'vilify people'on November 11, 2019 at 10:03 am
JPMorgan Chase CEO Jamie Dimon told “60 Minutes” on Sunday that income inequality is a “huge problem” but evaded a question about his $31 million salary and warned that his high-profile critics ...
- JPMorgan’s Dimon Laments Income Inequality, Won’t Assail CEO Payon November 10, 2019 at 4:00 pm
JPMorgan Chase & Co.’s billionaire Chief Executive Officer Jamie Dimon called U.S. income inequality a “huge problem,” but he stopped short of saying America’s top executives were being paid too much.
- As income inequality soars, languishing labor unions make a returnon November 10, 2019 at 3:40 am
After decades of declining membership and seemingly sidelined authority, a series of national strikes has put unions back in the spotlight. And as economic inequality has become a hot-button issue for ...
- Pete Buttigieg addresses ‘what matters’ to 2020 Democratic voters: Income inequalityon November 8, 2019 at 12:36 pm
Then Smith sits down with Indiana Mayor Pete Buttigieg to hear how he would address one of the voters’ top concerns: income inequality.Nov. 5, 2019 ...
via Bing News