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Politics : Mainstream Politics and Economics -- Ignore unavailable to you. Want to Upgrade?

To: grusum who wrote (8141)	2/4/2012 6:04:01 PM
From: TimF	Read Replies (1) \| Respond to of 85487

yes, all the things you mentioned, lower the cost of labor, which raises the value of labor. automation greatly lowers the cost of labor. Lower cost of labor per value produced. Often the labor by more standard measures (dollar per hour wages, total compensation per year, etc.) becomes more expensive (certainly in nominal, and often even in real terms), but the productivity increase is enough to more than make up for the higher price of labor. You might go from producing X with Y labor at Z rates (X at a labor cost of YZ), to 2X with 1/2 Y labor at 1.5Z rates (X costs .375Y, even with the higher cost per unit of labor) As for wealth and pet rocks - Wealth is just having something of value, value is subjective. If people feel that having a pet rock makes their life better (however tiny the improvement) than it is real wealth (if only a very modest amount of wealth). In a sense the pet rock is art broadly defined (not art defined as "high art" or "good art"), the production of art (defined to include not just painting and sculpture, but anything perceived to be of esthetic value, or producing of positive emotions from other than purely practical benefits), increases wealth. Personally the pet rock would have little value to me, perhaps negative after considering its take up of space, but they had enough of a market than I'm sure someone considered them of some value.