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RE: Economics of the Future

in #economics8 years ago

You've forgotten one factor - which is the cost of capital.

In order to make a robot you need to borrow the money, and make the thing. So it is only viable to replace a man with a robot if the cost of capital is so low that the Return on Investment from borrowing to make the machine is greater than you would get from hiring someone to do the job.

Why is unemployment so high right now? Because interest rates are so low that the cost of capital is practically free, so it is a no-brainer to replace your human staff with machines.

However if and when interest rates rise the calculation changes. Factor in that robots have a limited shelf life - you have to replace them every ten years, and if at that time interest rates are higher, then it might be worth hiring humans again.

In the last 200 years, interest rates have averaged about 4%. We're in a very unusual period. I know that some people believe that rates will stay low forever, but that's not how it works!

Where Steem comes in, is in the area of journalism and media. With ad-blocking on the rise and advertisers no longer willing to do expensive advertising campaigns, a model of media underpinned with a blockchain might be the answer. I can imagine Apple and McDonalds and other buying Steem Power to upvote any viral story that made their brands look good. I can see political parties doing the same, ditto pressure groups. Imagine the money that could be made at election time - in fact I think we should contact the Dems and GOP and ask them if they want to vote stuff up!

Steemit could be a new way of monetizing content - instead of the reader having to put up with ads, the advertiser simply purchases Steem Power and sets a bot to upvote any post that mentions their brand.

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