
Race Against the Machine

Digital technologies change rapidly, but organizations and skills aren’t keeping pace. As a result, millions of people are being left behind.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
The median worker is losing the race against the machine.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
We’ll start with skill-biased technical change, which is perhaps the most carefully studied of the three phenomena. This is technical change that increases the relative demand for high-skill labor while reducing or eliminating the demand for low-skill labor.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
But at the same time, the computer, like all general purpose technologies, requires parallel innovation in business models, organizational processes structures, institutions, and skills. These intangible assets, comprising both organizational and human capital, are often ignored on companies’ balance sheets and in the official GDP statistics, but t
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Digitization, in other words, is not a single project providing one-time benefits. Instead, it's an ongoing process of creative destruction;
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
At least since the followers of Ned Ludd smashed mechanized looms in 1811, workers have worried about automation destroying jobs. Economists have reassured them that new jobs would be created even as old ones were eliminated. For over 200 years, the economists were right.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
and focus on working-age households, real median income has actually fallen from $60,746 to $55,821. This is the first decade to see declining median income since the figures were first compiled. Median net worth also declined this past decade when adjusted for inflation, another first.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
The threat of technological unemployment is real. To understand this threat, we'll define three overlapping sets of winners and losers that technical change creates: (1) high-skilled vs. low-skilled workers, (2) superstars vs. everyone else, and (3) capital vs. labor.
Erik Brynjolfsson, Andrew McAfee • Race Against the Machine
Because the process of innovation often relies heavily on the combining and recombining of previous innovations, the broader and deeper the pool of accessible ideas and individuals, the more opportunities there are for innovation. We are in no danger of running out of new combinations to try. Even if technology froze today, we have more possible wa
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