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If as countries get richer they start to expand manufacturing & services, but then when (even) richer start to see a shift towards an emphasis on services, what does that mean for rich countries that currently still have large manufacturing sectors (like Germany for instance).
A structural account would suggest they will (too) pivot towards services, while those countries (held) in a poorer economic situation will continue to produce any goods we need....
1/2 (short thread)
But there is, of course an issue of productivity here.... the application of technology in both agriculture & in manufacturing can enhance the productivity of the workforce to allow maintenance or even expansion of output with the same or fewer workers.
But, increasing productivity in services is much more difficult.
This seems a simple story, but actually what happens is low productivity manufacturing & farm work is exported to poorer countries...
which leaves the case of UK to ponder?
2/2
@ChrisMayLA6 Much more worrying is when China hits that.It'll be a hell of a fast change there.
In the 1990s I used to joke that applying the ideas of disruptive technologies to countries implied that the ones at the top would eventually employ only lawyers and then collapse. It's looking slightly less funny at this point.
Yes, that's a really interesting point.... what comes after the domination of services.... I was going to add a third part of thread about how the rich countries actually still need physical goods, but its less clear poorer countries need the 'sophisticated' services of the richest....
> its less clear poorer countries need the 'sophisticated' services of the richest....
I was reading a thread only yesterday about the consequences of the West in the 1990s having providing 'sophisticated' financial services to post-Communist Russia (perhaps not "poor" in the same way but not financialised either) and how that is one of the factors that led to the dominance of Putin
yes, the construction of the kleptocapitalism that enriched first the oligarchs & then Putin, was pretty much imported from economics departments in the USA....