RE: If You Want Jobs, Take Away Their Shovels and Give Them Spoons
When it becomes less expensive to transport goods, said goods become cheaper than they would’ve been otherwise. These lower prices improve everybody’s standard of living.
This is a common misconception. A business sets its price by looking at the demand curve and estimating how many units they will be able sell at each price point, then multiplying by profit per unit at each price point to figure out which price point will yield the most profit.
Which is a round about way of saying that a business will charge precisely what they feel the market will bear, and pocket any money they save from a decrease in production costs.
If a widget costs $100 before automation reduces costs by $10 per widget, then the effect of automation will be that widgets continue to cost $100, but Widget Co. International will pocket an extra 10 bucks per unit sold.
I'd agree with you if it were just one company realizing the cost savings. However, many other companies would see similar savings. I would contend that the companies would then undercut each other because they would now have the extra margins to do so.