Innovation, wages and wealth

To understand one of the interesting questions of the interesting time we live in, James Bessen has done us a great service of applied historical analysis by delving into the historical connection between technological change and employment and wages to shed light on how the technological changes that we're currently seeing might impact employment and wages in the long(er) run.

Substitution or complementarity I: A cause for anxiety?

There are (at least) two ways to think about how the adoption of machines influences employment. The classic way is to think that machines substitute for labor, that machines replace human workers in order to increase productivity. The other way is to think that machines make human workers more efficient and therefore enhance the value of human work, leading to increased demand for human labor. Machines, in this view, complement labor.