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Tomas Kutaj

Business Development Director , Netbit

TEDCRED 20+

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Is Information Technology destroying jobs?

Last week in my company we have delivered system that made one of their labour hard process automatic, which resulted into people losing jobs (in the clients company)

As a dev guy I think it is great to save hard work but on the other hand I feel guilty that people are losing jobs. What do you think?

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    Oct 8 2013: apparently, the topic is deeply attached to the nature of causal relationships between actions and effects. namely, it is essential to analyze the relation between introducing a new technology, and the resulting shift in the structure of the economy, and in particular, the job market. let me introduce a series of thought experiments, that supposed to shed a light on the issue.

    case 1. a restaurant operates in a town. another person opens a restaurant in the immediate vicinity. the two restaurants are similar in popularity, thus the clientele of the old restaurant is cut by half.

    case 2. a restaurant operates in a town. another person opens a pig farm in the immediate vicinity. the disgusting smell drives customers off, and thus the clientele of the restaurant is cut by half.

    case 3. a restaurant operates in a town. people watch the TED talk of jamie oliver, and many decides that they start to cook for themselves. the clientele of the restaurant is cut by half.

    case 4. two restaurants operate in a town. one of them cuts the price by 10%. the clientele of the old restaurant is cut by half.

    how do we analyze these situations? what are the differences, what are the similarities. at the end, we want to know whether the actions described are moral, legal, beneficial, harmful, fair, should be allowed, should be forbidden, the actors should be punished, etc. i hope i inspire thinking and not just the endless rehearsal of half baked wisdom.
    • Oct 9 2013: interesting thoughts. case 1 and 4 depends on many factors. Having more restaurants in the area can actually bring new patrons to each restaurant because their advertising for given area will increase. Also patrons are more likely to go to an area where they have more choices?

      If one restaurant offers discount but doesn't provide good food quality it might not impact the other restaurant.

      This is not sum zero system.
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        Oct 9 2013: for the sake of it, suppose the town can be thought of a closed system. for this, we only need to assume that below 1% of the inhabitants would go somewhere else to dine, and we have negligible foreigners around. cities too far, road too bad, not near main routes, etc.

        studying isolated cases like this helps focus on the concept, rather than looking for ways to escape the problem. it is a case of robinson economics.
        • Oct 9 2013: You cannot really say how many residents go to eat out without survey or measurements.

          There is a large number of people that will go to restaurant if they get incentive, whether it is a discount, good food, friend's recommendation etc. That is why I don't think having a new restaurant will necessarily decrease the number of patrons of the other restaurant.

          Such systems are really complex based on complex behaviors of individuals as well as the community.
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        Oct 9 2013: i did not say it necessarily decreases. in our concrete case, it did. we should focus on the question at hand, and not extend it until it will be too big to handle.

        or maybe your point is that your analysis depends on those numbers? so for example you say in case 1 and 4, your moral judgment depends on whether indeed the same people stopped going to one place and started going to the other place, whether their reason is not something else but the depicted change, and whether it is temporary or final. if this is what you are saying, go ahead, and explain present your subcases 1a, 1b etc.
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      Oct 9 2013: Well, then analyze, so we get to see how baked your wisdom is ...
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      Oct 9 2013: Just some quick remarks on what you may clarify or change before you do your analysis:


      Case 1: What are the numbers of both restaurants. Price calculations? Number of employess, wages, margins, raw food prices, energy cost, etc. etc. etc.

      Case 2: Impossible by law

      Case 3: How many people have seen the TED talk? What it the long term behavior of those people who started to cook for themselves? How many 'emergency orders' will be placed by people who failed in early cooking due to their limited talents? What is the rate of their learning curve? Distributions?

      Case 4: No information on popularity levels before price cut. Is the price cut permanent or a dumping attempt? What are the numbers of both restaurants. Price calculations? Number of employees, wages, margins, raw food prices, energy cost, etc. etc. etc.

      Not enough and and also inconsistent data for any analysis better than guessing at the moment.

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