Thursday, 4 February 2010

Productivity or Jobs

A recent letter to the Denver Post complained about $200k of 'stimulus money' being spent on road signs. The response was to suggest that the letter-writer did not understand stimulus spending (what an intelligent defence!). But it also - in the context of climbing out of the recession - leads to the old question about whether productivity creates jobs or kills jobs.

Of course in the short term it can do either ... but in the longer term it creates many more jobs than it might kill. Try decreasing productivity, see how competitive you become and see how many jobs you save.

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