Amazing. Does this person ever think straight? Does he ...engineer all his opinions?



"[...]market forces, if allowed to play out, might eventually exert a stabilizing role."



??? What is this? Is this guy blind to modern economics? Is he aware of Dr. Stiglitz PhD? "If allowed to play out"??? Whenever there is asymmetry of information --that is always-- markets are imperfect (I suppose, we do not know how imperfect: for all we know, they could lead to the worst possible outcome for the largest proportion of the population!).



"[...] the greater the premium for highly skilled workers, the greater the incentive to find ways to economize on employing their talents."



This sounds like ...letting employers "innovate" on how to prohibit technological innovation, since this is the basic engine of highly skilled employment creation. Alternatively, it could mean, allowing employers to "innovate" on ways in which payment of highly skilled workers will stagnate. That is exactly what happened with the US middle class.



Is there any other way? Does prof. Rogoff agree to allow market forces "to economize on employing skilled workers' talents," but prohibit the previous two choices? Unless, we have to trust the markets to bring about yet another crisis?



Maybe, the point of prof. Rogoff is exactly to let employers try to stagnate highly skilled worker income, and see if such workers will create firms to sell their skills in organized ways. This way, markets will be created (among these new firms) -- the dream of every economist, which will lead to the "best" price for highly skilled labor.



If only we could find ways to automate the work of highly skilled financiers.... Their work is such a long way of producing any benefit for society (in fact the opposite is exaggerated because of the financial crisis), and they are extracting huge rents from the economy with their bonuses. Ah! And neither before nor after the crisis, did I see any result from the "incentive to find ways to economize on employing their talents"!!!



Yes, there can be technological innovation that further pushes the boundary of skill required to have a job, rendering large sectors of knowledge subject to automated procedures and further levels of peoples' skills useless. Automated software production, can and will leave large numbers of plain web and application programmers without a use for their skills and, of course, without a job. This will save some of the need to employ skilled workers. But, such "savings" will always come from the bottom of the scale of skills.



The only case when automation will be able to "save" humanity from most of skilled labor, will be when technological innovation stops and new knowledge becomes mostly the work of computers scanning big data. At that point, knowledge increase will pause, and automation will eventually catch up with all knowledge before that time. There are no signs of a slowdown in knowledge increase. Still, this could come in the form of diminishing returns from new knowledge. There are no broad signs of that either.

