Productive Advances: Who Benefits Most?

by Joseph S. Fulda

The free enterprise system allows inventors and investors to reap the rewards of creativity and risk. But in a market economy, those who gain most from the productive advances thought of by inventors and funded by investors are the poor. Let us examine several productive advances and see to whom the benefits accrue.

Consider first the printing press. The very rich had scribes and private secretaries do their clerical work, but the very poor are now literate in numbers once deemed impossible. Or to move up the centuries, consider the television. The rich had hours of leisure and the funds for private entertainment to fill them. The poor, however, now have an entertainment cornucopia undreamt of in earlier ages. As a third example, consider air travel. The rich were able to afford weeks of travel by land or sea, while their properties continued to generate income. Those less well off, on the other hand, would never see distant lands or relations without air travel.

Or consider antibiotics, one of the twentieth century's miracles. The rich who live in sanitary, spacious quarters have had less need of these wonder drugs than those who occupy crowded, unsanitary, slum areas. Finally, consider that mundane appliance, the vacuum cleaner. The rich often have others do their housekeeping. Their housekeepers, in contrast, have had their jobs simplified and their hourly output increased by the vacuum cleaner's invention.

From little things to big things, the principle holds. Productive advances help everyone, but most of all the less well-to-do.

This is hardly limited to inventions and discoveries, but applies to improvements in productive methods as well. Who has been helped the most by specialization, mass production, automation, and robotics? The rich consumer could always afford the work of the skilled craftsman, but the poor shopper depends on the economies of modern technology and productive methods for the wide variety of household items from which he chooses. Likewise, advances in these productive methods may enrich the factory owner, but it is his workers whose jobs over the decades have become lighter, more meaningful, and better paid. Nor is this observation true only of blue collar workers. From the pencil to the typewriter to the electric typewriter to the word processor, the jobs of the lowest paid white collar workers have also become lighter, more meaningful, and better paid.

Nor have all these advances thrust millions into idleness (although there is some temporary dislocation), as the doomsayers have warned. Rather, mankind's energies have been channeled more and more into the good things of life and less and less into its bare necessities.

Government redistribution of wealth has not been the cause of the remarkable improvement in our standard of living over the years. It is only productive advances that make the same physical effort count for more and only economic growth so arising that can truly increase everyone's rewards. And when productivity is enhanced and the economy grows, it is the poor who are most lifted by the rising tide.