Technology Is Great, but Won't Fix the Job Market

A blog about business and economics.
Nov. 19 2013 4:30 PM

Technology's No Replacement for Stimulus  

Horace Dediu recently made a cool chart showing adoption ramps for various technologies in the United States. The curve starts when only 10 percent of households had a given technology, and ends when 90 percent of households had it.

He was making another point with it, but it's particularly fascinating to focus in on the 1930s. You see that something as great as electricity actually stalled out at around a 67 percent adoption rate. Automobile ownership stagnated for about 10 years. Telephones actually got less popular. Stoves plateaued for a few years. In retrospect, we can all see this as the impact of the Great Depression (and for the car, wartime rationing). People didn't have any money, so they didn't buy new stuff. But they didn't entirely stop buying new stuff. The popularity of radios just kept skyrocketing throughout this entire period.

Advertisement

I thought of this while disagreeing with Michael Mandel this afternoon about the role of innovation in generating adequate demand and full employment:

Which is to say that back in the 1930s, I bet a lot of people thought innovation had stalled out. Radios were there to serve kind of like our smartphones—an example of how demand for a really cool innovative new product can stay robust regardless of what central banks are doing. But radios/smartphones were just one small thing. To really unleash economic growth you needed a whole bunch of new innovations! Not a bunch of nonsense like electricity and cars that were fads in the 1920s but seemed played out by 1935.

Of course that turned out to be exactly backward. For the innovations of the era to really shine, you needed a return to full employment and rising incomes. The 1920s weren't a "car bubble" that crashed in the 1930s, they were a harbinger of a trend that would continue once macroeconomic management got back on trap.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

TODAY IN SLATE

Politics

Talking White

Black people’s disdain for “proper English” and academic achievement is a myth.

Hong Kong’s Protesters Are Ridiculously Polite. That’s What Scares Beijing So Much.

The One Fact About Ebola That Should Calm You: It Spreads Slowly

Operation Backbone

How White Boy Rick, a legendary Detroit cocaine dealer, helped the FBI uncover brazen police corruption.

A Jaw-Dropping Political Ad Aimed at Young Women, Apparently

The XX Factor
Oct. 1 2014 4:05 PM Today in GOP Outreach to Women: You Broads Like Wedding Dresses, Right?
Music

How Even an Old Hipster Can Age Gracefully

On their new albums, Leonard Cohen, Robert Plant, and Loudon Wainwright III show three ways.

How Tattoo Parlors Became the Barber Shops of Hipster Neighborhoods

This Gargantuan Wind Farm in Wyoming Would Be the Hoover Dam of the 21st Century

Moneybox
Oct. 1 2014 8:34 AM This Gargantuan Wind Farm in Wyoming Would Be the Hoover Dam of the 21st Century To undertake a massively ambitious energy project, you don’t need the government anymore.
  News & Politics
The World
Oct. 1 2014 12:20 PM Don’t Expect Hong Kong’s Protests to Spread to the Mainland
  Business
Moneybox
Oct. 1 2014 2:16 PM Wall Street Tackles Chat Services, Shies Away From Diversity Issues 
  Life
Outward
Oct. 1 2014 6:02 PM Facebook Relaxes Its “Real Name” Policy; Drag Queens Celebrate
  Double X
The XX Factor
Oct. 1 2014 5:11 PM Celebrity Feminist Identification Has Reached Peak Meaninglessness
  Slate Plus
Behind the Scenes
Oct. 1 2014 3:24 PM Revelry (and Business) at Mohonk Photos and highlights from Slate’s annual retreat.
  Arts
Brow Beat
Oct. 1 2014 9:39 PM Tom Cruise Dies Over and Over Again in This Edge of Tomorrow Supercut
  Technology
Future Tense
Oct. 1 2014 6:59 PM EU’s Next Digital Commissioner Thinks Keeping Nude Celeb Photos in the Cloud Is “Stupid”
  Health & Science
Science
Oct. 1 2014 4:03 PM Does the Earth Really Have a “Hum”? Yes, but probably not the one you’re thinking.
  Sports
Sports Nut
Oct. 1 2014 5:19 PM Bunt-a-Palooza! How bad was the Kansas City Royals’ bunt-all-the-time strategy in the American League wild-card game?