Wednesday, June 22, 2022

Digital Era — Poor productivity and rising economic inequality


In the span of about 40 years, the Digital Era has brought new technologies that have benefited people's lives on all continents. However, since the end of the Second World War, the decades from 1980 have seen more economic inequality and concentration of wealth in advanced countries in particular.

Big digital companies are near-monopolies in their markets and can buy young companies to either use new technologies or kill them.

In recent decades aggregate productivity growth has fallen in many economies resulting in poor economic growth trends.

So-called frontier firms are doing well but there are many more laggards. 

In May 2022 the Brookings Institution of the United States published a report titled 'An Inclusive Future? Technology, New Dynamics, and Policy Challenges.' It has contributions from leading economists.

The report says "Income inequality has risen in most countries since the 1980s. Practically all major advanced economies have experienced a rise in income inequality, and the increase has been particularly large in the United States, the country at the leading edge of the digital revolution.

Those with middle-class incomes have been squeezed. The typical worker has seen largely stagnant real wages over long periods — and increased anxiety about job loss from automation. Intergenerational economic mobility has declined. Income distribution trends are more mixed in emerging economies but many of them—and most of the major emerging economies — also have experienced rising inequality. Figure 1 shows the trend in the Gini coefficient, a broad measure of inequality, in the 19 major advanced and emerging economies that are members of the G20 (the EU is the 20th)."

Friday, June 10, 2022

Web Summit chief calls Irish government a crime cartel

In November 2021 the annual Web Summit event opened in Lisbon with 4 Irishmen (Cosgrave and 3 witnesses that had come from Dublin) trying to persuade about 40,000 international delegates that the Irish government was irredeemably corrupt. Besides, it was a lie that Ireland was the most corrupt country in Western Europe. At the time the Web Summit firm was relying on the government of Portugal for almost half its annual revenues while Portugal was the most corrupt country in Western Europe. Cosgrave's showcase of alleged Irish corruption was in effect hypocrisy on a grand scale.

Paddy Cosgrave, the main shareholder of the Web Summit, tweeted on March 29, 2022 "Ireland amongst most corrupt countries in Western Europe." He well knows that it's Portugal, the Web Summit's biggest government funder, that leads the corruption stakes.

In 2015 Ernst & Young, a Big 4 accountancy firm, placed Portugal as the fifth most corrupt country among 38 global countries.

The Salazar dictatorship (1932-1974) was the longest since World War 1 in Western Europe and Portugal held slaves in Africa into the 20th century. In recent times the elite has conspired with the kleptocrats of the oil-producing former colony of Angola.