[Steve_American]

Presented at the
London School of Economics and Political Science (LSE)
Published on May 5, 2016
Speaker: Professor Robert Hall

The annual Phillips Lecture, jointly sponsored by the journal Economica and the Department of Economics in which Professor Hall, one of the world's leading macroeconomists spoke on the macroeconomics of persistent slumps.

Robert Hall is Robert and Carole McNeill Senior Fellow at the Hoover Institution and Professor of Economics and Stanford University.

Dr. Hall is not a good public speaker and the slides are not put onto the screen. The presentation was filmed and the camera rarely showed all the slides clearly.

Still I thought there were a lot of good facts presented on those slides. Maybe you can skip through it to stop on the slides when they are shown.

At the end [before the Q&E period] Dr. Hall says it is unknown why there is so little new investment in the US economy after the crash of 2008 [and especially in 2015 +or - 1 year]. And this has led to a drop in the rate of productivity *growth*.
. . I would ask him how much of the problem is the lack of demand for goods and services in the US economy and also in the world economy. Demand being caused by people with money to spend who want to buy something or service. So isn't it true that if there is no demand then there will be a lack of interest in investing in productivity improvements? And, isn't it true that the lack of demand is caused by the very slow wage growth in the US and austerity measures in the EU? This has led to people not having money to spend.

[redcarpet]

One major one is logically the abandonment of the manufacturing economy to the Third World & swapping that for a internet & automation-based economy in Western societies. It means lower wages and yet more variety & quicker goods and services.

[Steve_American]

Redcarpet,
Thanks for your reply.
I think you kissed missed the question. Automation should increase productivity. Dr. Hall says productivity is growing slower than it did in the 90s or the 2000s. He wants to know why? He says there is plenty of money in the banks to lend and interest rates are low, so why are not capitalists investing to increase productivity faster?

[redcarpet]

Redcarpet,
Thanks for your reply.
I think you kissed the question. Automation should increase productivity. Dr. Hall says productivity is growing slower than it did in the 90s or the 2000s. He wants to know why? He says there is plenty of money in the banks to lend and interest rates are low, so why are not capitalists investing to increase productivity faster?

Lol because the/many just send the extra profits (which keep rising) to tax havens. They can still make a profit without ordering the investing in new production, etc.

[Atlantis]

The people with "demand" don't have money to satisfy that demand, while people who have the money don't have many unfulfilled needs. It's as simple as that.

Let's just forge about America. America needs to go away. Let's look at the 3rd world and the emerging markets. There is plenty of growth potential and a large workforce to generate wealth.

[Crantag]

Redcarpet,
Thanks for your reply.
I think you kissed the question. Automation should increase productivity.

According to Marx, although automation indeed increases productivity, it also slays profits.

Companies are driven to replace workers with machines in order to reduce labor costs.

The early adopters of this approach enjoy temporary high profits, but their competitors soon follow soot, and the profit rate shrivels up.

The reason is that machines in and of themselves do not contribute new value to production. The value of the machines is reflected in the cost associated with their purchasing.

Under conditions of automation, producers indeed must automate in order to keep up with the standards of their competitors. But once all automate, the profits are slain as a result.

You seem to grasp externalities; think of this as essentially a sort of externality.

[Steve_American]

Crantag, thanks for pointing out my typo, I have edited it.

Dr. Hall was asking why there was less growth in productivity since 2008. It was his question.
Is your answer this? --- Capitalists in the US finally got smart and realized that automation slays profits. So, they got together and agreed to not invest in new tech that would only in the end reduce their profits. Well, that is an answer. I wonder if Dr. Hall will think it is a good answer. However, more likely I just put words into your mouth that you didn't say or mean to say. If so then I'm sorry. Maybe you might want to say what you mean more often and not dance around what you mean so much.

[Crantag]

Crantag, thanks for pointing out my typo, I have edited it.

Dr. Hall was asking why there was less growth in productivity since 2008. It was his question.
Is your answer this? --- Capitalists in the US finally got smart and realized that automation slays profits. So, they got together and agreed to not invest in new tech that would only in the end reduce their profits. Well, that is an answer. I wonder if Dr. Hall will think it is a good answer. However, more likely I just put words into your mouth that you didn't say or mean to say. If so then I'm sorry. Maybe you might want to say what you mean more often and not dance around what you mean so much.

No, that's not what I was saying at all. I was pointing out one of the classical flaws of capitalist production as elaborated by Marx. It's a sort of paradox of automation.

[One Degree]

I have a much simpler view for reduced demand. I use to need a tv, radio, stereo, phone, and computer. Now, most people just need a phone. Our demand is for fewer things therefore less demand.

[Rugoz]

The video is 1h25m...