The Accidental Theorist

The Accidental Theorist

In this article Krugman criticizes William Greider who is a journalist at Rolling Stone magazine and recently wrote a book called One World, Ready or Not: The Manic Logic of Global Capitalism.

Greider thinks that technological enhancements destroy employment and rapidly growing supply will be higher than consumer demand. Global capitalism leads economies to crises.

Adversely, Krugman states that technological improvement will just cause a change in the structure of employment. But there won't be a net loss in the future. As productivity increases the supply, economy can raise consumption in the same way by employing those spare workers who were affected by productivity improvement.

Or particularly technological improvement in one sector can reduce number of workers in the sector but these workers will be possibly employed by other relevant sectors. And the authors approach isn't enough to catch that point because he just interviewed sector executives individually without creating hypothetical economies and engaging with thought experiment as Krugman does.

Also Krugman gives real life example to support his idea. Between 1970 and today, manufacturing sector's output doubled and because of productivity increase employment declined. The production of services also doubled but there was no productivity improvement, and employment grew by 90 percent. So productivity growth in one sector has led to job gains in the other.

CAPITALISM'S MYSTERIOUS TRIUMPH

Krugman argues reasons behind fall of socialism against capitalism after 1980's, which was competing in the 1940's and 1950's.

Times of World War II, despite of early huge losses, Russia could have managed to beat Germany by manufacturing