Follow the link (headline) if the figures don't come out -- http://www.epi.org/publicat
ion/understanding-the-historic -divergence-between-productivi ty-and-a-typical-workers-pay-w hy-it-matters-and-why-its-real /
Correct--- "productivity" in management-ese simply means speedup. But it has a technical meaning in economics that means: the real source of economic growth -- that is, total increase in wealth - creation per worker- in a market economy. Ironically, or perhaps dialectically, the substitution of capital for labor over time is both a key economic source AND consequence of both industrial worker bargaining power and its struggle to destroy itself as an enslaved class, under capitalism. This phenomenon was still in its infancy when Marx, Ricardo and Adam Smith and other classical economists were more concerned about the obvious countervailing immiseration tendencies of capitalism, very visible and naked in early days -- not just early days!--alongside capitalism's epochal rending of the ancient feudal order.
the longer range data correlation of rising productivity and real wage increases is a very strong one, and divergences are correlated with greater social and economic disorder. Calling the correlation causal is tempting. However any real link between them must also be intricately entangled with social, cultural, national, environmental, class, and political environments in which the elemental forces unleashed by the circulation of commodities and capital (capitalism) emerge and grow.
There are serious problems, however, in accurately measuring "productivity", especially in the area of services and intangible products, arising from the fact that the latter are, in economic theory, what Paul Samuelson called "squshy" commodities. They don't work like a traded physical commodity -- they can be cheaply -- almost freely in any global scale sense -- copied.
That's just one of a number of things messing up the theories of growth -- why productivity is not rising faster than regular economic surveys are capturing; why almost all the wealth growth since about 1973 has been captured by the billionaires. Does a global fundamental slowing of mass demand affecting the "growth feedback loops" that make growth sustainable?; The billionaires have used part of that increased wealth to accumulate comparable political power -- both in elected offices, and within the regulatory institutions designed to regulate them.
But the big deal is this: The New Deal social contract -- active through Lyndon Johnson -- returned roughly comparable portions of national wealth to capital, and to labor. If GNP went up 1% (above population growth) -- wages and salaries at the median moved the same. There were huge movements of the left out, especially African Americans, for their just share of the American Dream of shared prosperity.
How to establish again a principle of equity -- basically equal pay for equal work -- that governs the distribution of income as well -- is the basic economic question upon which social progress, including more socialism, depends.
On Wed, Apr 5, 2017 at 5:24 PM, Mike Beilstein <email@example.com> wrote:
...Hello John Case-I'll try to read this. The figures don't come out in the email, but probably not essential. I figured out long ago that "productivity" is a euphemism for "squeezing the workers." For example, productivity of cotton picking in the early 19th Century in the US South more than doubled through the introduction of systematic torture that rewarded the fastest pickers with less pain, and incentivized the slower pickers with more. I doubt that any planter ever considered raising the wages of slaves to match their improved productivity. Productivity probably has several modern economic definitions, but it clearly is the rate of profit divided by rate of labor. Increased productivity is simply more efficient squeezing the life out of workers.Mike BeilsteinCorvallis, OR