What impact will automation – the so-called “rise of the robots” – have on wages and employment over the coming decades? Nowadays, this question crops up whenever unemployment rises. In the early nineteenth century, David Ricardo considered the possibility that machines would replace labor; Karl Marx followed him. Around the same time, the Luddites smashed … Continue reading The Rise of the Robots

What impact will automation – the so-called “rise of the robots” – have on wages and employment over the coming decades? Nowadays, this question crops up whenever unemployment rises. In the early nineteenth century, David Ricardo considered the possibility that machines would replace labor; Karl Marx followed him. Around the same time, the Luddites smashed … Continue reading The Rise of the Robots

The editor of The Guardian, Alan Rusbridger, has written a book about how he decided to practice the piano 20 minutes a day. Eighteen months later, he played Chopin’s fearsomely difficult Ballade No. 1 in G Minor to an admiring audience of friends. Could anyone have done this? Or did it require special talent? The … Continue reading Natural-Born Pianists?

“Why did no one see the crisis coming?” Queen Elizabeth II asked economists during a visit to the London School of Economics at the end of 2008. Four years later, the repeated failure of economic forecasters to predict the depth and duration of the slump would have elicited a similar question from the queen: Why … Continue reading Models Behaving Badly

It is generally agreed that the crisis of 2008-2009 was caused by excessive bank lending, and that the failure to recover adequately from it stems from banks’ refusal to lend, owing to their “broken” balance sheets. A typical story, much favored by followers of Friedrich von Hayek and the Austrian School of economics, goes like … Continue reading Inequality is Killing Capitalism

The king of Bhutan wants to make us all happier. Governments, he says, should aim to maximize their people’s Gross National Happiness rather than their Gross National Product. Does this new emphasis on happiness represent a shift or just a passing fad? It is easy to see why governments should de-emphasize economic growth when it … Continue reading Happiness Is Equality

US President Barack Obama has vowed to avenge the murder of J. Christopher Stevens, America’s former ambassador to Libya. How he proposes to do this is unclear – historical precedent is of little use. In 1864, the Emperor of Abyssinia took hostage the British consul, together with some missionaries, in the country's then-capital, Magdala. Three … Continue reading Big Countries, Small Wars

As Olympic mania swept the world in recent weeks, it transported the host country, Great Britain, to a rare display of public exultation. Indeed, the successes of “Team GB” produced an upsurge of patriotic rejoicing akin to victory in war. Britain finished third in the gold medal count, behind the United States and China, much … Continue reading Olympian Economics

How much inequality is acceptable? Judging by pre-recession standards, a great deal of it, especially in the United States and Britain. New Labour's Peter Mandelson voiced the spirit of the past 30 years when he remarked that he felt intensely “relaxed” about people getting “filthy” rich. Getting rich was what the “new economy” was all … Continue reading The Bad Society

As people in the developed world wonder how their countries will return to full employment after the Great Recession, it might benefit us to take a look at a visionary essay that John Maynard Keynes wrote in 1930, called “Economic Possibilities for our Grandchildren.” Keynes’s General Theory of Employment, Interest, and Money, published in 1936, … Continue reading Labour’s Paradise Lost