Technology enables economic success, responsibilities: economist

Employees' ability to use technology wisely appears to increase their earnings potential. The recent more than doubling of the U.S. productivity rate, enabled in part by use of technology, may allow sustained U.S. growth greater than previously thought possible, even with very low unemployment.

07/01/2000


Employees' ability to use technology wisely appears to increase their earnings potential. The recent more than doubling of the U.S. productivity rate, enabled in part by use of technology, may allow sustained U.S. growth greater than previously thought possible, even with very low unemployment. However, global technology use may also augment severity of human errors related to managing world economic health.

These are some of technology's key influences on the U.S. and global economy, according to Dr. Laura D'Andrea Tyson, dean of Haas School of Business at the University of California (Berkeley, Calif.). She delivered her analysis at Siemens Corp.'s (New York, N.Y.) Industry Press Forum here on May 24.

The global economy is stronger now than in the 1980s, with a 4.5% GDP and 3.5% inflation. There are differences across regions, she noted, but the present recovery is broad-based. Earlier liquidity problems and 1998's currency crisis and recovery in Asia, Russia, and Latin America showed the interdependence of world markets. Thailand, a very small economy, started the crisis. Today, there's a global expansion in place that's likely to withstand a U.S. "soft-landing," an economic slowdown designed to slow growth to a sustainable rate, without recession. Still, with the U.S. accounting for 25% of global GDP and 75% of the expansion among G7 countries, the world is watching.

Computers fuel productivity

The most recent series of interest-rate hikes were held off, Dr. Tyson says, because productivity since 1995 increased from a 25-year historical average of 1% to 2.5% now. That gain has offset effects of a tight labor market to creating economic growth. Up until 1995, the IT revolution hadn't had visible benefits on U.S. productivity, which baffled many observers. Since then, she explains, a critical mass of information infrastructure (equaling, in adjusted terms, the assets amassed by railroads at their peak) has more than doubled what economists felt was a sustainable rate of gain in U.S. productivity. Other countries' economies seem likely to follow. So far, the U.S. has the largest portion of the world's 275 million Internet users. Two billion or more users are expected globally in five years, with most growth outside the U.S.

In addition, technology use by individuals has appeared to create an elite skill class in many professions, where earning potential increases dramatically with technological expertise. Those with specialized knowledge, professors, for example, have found Internet-enabled ways to sell information for profit, perhaps to the consternation of their employers. In another build-up of wealth, more frequent use of stock options has also decreased earnings' pressure on inflation.

From a global economic view, the new speed of technology-enabled transactions can add to human errors of economic policy, sometimes contributing to a currency crisis that swamps smaller economies. Despite technologies, some fixes require "good old-fashioned policymaking," adds Dr. Tyson.





No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
The System Integrator Giants program lists the top 100 system integrators among companies listed in CFE Media's Global System Integrator Database.
Each year, a panel of Control Engineering and Plant Engineering editors and industry expert judges select the System Integrator of the Year Award winners in three categories.
This eGuide illustrates solutions, applications and benefits of machine vision systems.
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Controller programming; Safety networks; Enclosure design; Power quality; Safety integrity levels; Increasing process efficiency
Additive manufacturing benefits; HMI and sensor tips; System integrator advice; Innovations from the industry
Robotic safety, collaboration, standards; DCS migration tips; IT/OT convergence; 2017 Control Engineering Salary and Career Survey
Featured articles highlight technologies that enable the Industrial Internet of Things, IIoT-related products and strategies to get data more easily to the user.
This article collection contains several articles on how automation and controls are helping human-machine interface (HMI) hardware and software advance.
This digital report will explore several aspects of how IIoT will transform manufacturing in the coming years.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

Infrastructure for natural gas expansion; Artificial lift methods; Disruptive technology and fugitive gas emissions
Mobility as the means to offshore innovation; Preventing another Deepwater Horizon; ROVs as subsea robots; SCADA and the radio spectrum
Future of oil and gas projects; Reservoir models; The importance of SCADA to oil and gas
Automation Engineer; Wood Group
System Integrator; Cross Integrated Systems Group
Jose S. Vasquez, Jr.
Fire & Life Safety Engineer; Technip USA Inc.
This course focuses on climate analysis, appropriateness of cooling system selection, and combining cooling systems.
This course will help identify and reveal electrical hazards and identify the solutions to implementing and maintaining a safe work environment.
This course explains how maintaining power and communication systems through emergency power-generation systems is critical.
click me