Sunday, April 2, 2017

Economy: Do We Need A Robot Tax?

(Drivebycuriosity) - There is a lot ado about robots. Many claim that robots are "stealing" our jobs and Bill Gates recommends a tax on robots ( Do we really need a robot tax?

If robots would steal our jobs then unemployment would rise, but it doesn´t. Quite contrary, in the US the unemployment rate dropped to 4.7%, weekly jobless claims hover around a 40 years low,  the economy has been adding about 200,000 new jobs per month and wages are growing (calculatedrisk).

If robots would really replace a large number of workers then the productivity of the economy would rise and production (output) per employed worker hour would climb. Unfortunately the statistics reveal that the US & Europe are experiencing an anemic growth of the productivity (barrons). A robot tax would slow down productivity growth even further because companies would use less robots which will would production less efficient. This would slow down the already sluggish economic growth in the US & Europe (which is growth of the workforce multiplied with productivity growth).

A robot tax also would make cars and other industrial goods which are partly produced with the help of robots more expensive (bloomberg). Low income groups could afford less things (cars, electronics etc) which would restrain consumer spending and economic growth and could even cause a recession.

A robot tax would also discourage companies to invest in modern technologies. They would spend less money to develop software, newers computer chips, sensors and other technologies which would curb technological progress & innovation.

I think that we will soon need more robots. There is a lot ado about the changing demographics and it is feared that an "aging population"will lead to a "shrinking work force" (in some countries like Japan this is already happening bloomberg  washingtonpost). Robots could be the answer and fill the widening gap between the work force and the retired persons. It seems that we will need more & robots to supply goods & services for the growing number of the retired.

There might be a future when robots do all the work. In this utopian world goods & service will be abundant and extremely cheap. Governments would then earn much more tax income - thanks to the enormous wealth of this science fiction society - which easily could be used to pay everybody a sufficient minimum income. But this is not our world yet.

Bill Gates is a very successful - and very lucky - business man but a very bad economist.

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