MIT professor and co-author Daron Acemoglu suggests that economic prosperity comes from high-wage job creation.

Fiona Sydney

2019-05-19 19:31:00 Sun ET

MIT professor and co-author Daron Acemoglu suggests that economic prosperity comes from high-wage job creation. Progressive tax redistribution cannot achieve the same economic gains that would result from more high-skill employment. The government should promote better tech advances and labor market institutions to empower workers through higher education systems. Also, the government should encourage firms to deploy better technology to boost real wage growth and labor productivity. The government can increase product market competition such that firms cannot charge monopoly prices without hiring more workers. Meanwhile, the current institutional architecture depresses U.S. private-sector wage growth (2.5% per annum from 1947 to 2000 and almost nil thereafter). In this negative light, the government should raise the U.S. tax-revenue-to-GDP ratio from 27% to the 35% OECD benchmark. The incremental fiscal intake can help ensure higher wages for tech-savvy high-skill workers.

Moreover, the government has to set clear rules with respect to tech market power, privacy, and content curation. Recent examples include the E.U. fines on Google for online search market dominance, Facebook-Cambridge-Analytica data breach, and Amazon premium user surveillance via Alexa-and-Echo artificial intelligence. These rules may entail plausible penalties on foreign interference in U.S. elections, privacy invasion, and the viral distribution of inappropriate content etc.

 


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We share famous inspirational stock market quotes by Warren Buffett, Peter Lynch, Benjamin Graham, and several others.

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2018-08-31 08:42:00 Friday ET

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2018-01-06 07:32:00 Saturday ET

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2018-11-30 12:42:00 Friday ET

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Warren Buffett points out that American children will be better off than their parents in the next decades.

Dan Rochefort

2018-01-05 07:37:00 Friday ET

Warren Buffett points out that American children will be better off than their parents in the next decades.

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Berkeley tax economists Gabriel Zucman and Emmanuel Saez find fresh insights into wealth inequality in America.

Jacob Miramar

2019-06-27 10:39:00 Thursday ET

Berkeley tax economists Gabriel Zucman and Emmanuel Saez find fresh insights into wealth inequality in America.

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