Technology and innovation play a major role in the development of emerging and developed economies, as it provides an opportunity for businesses to produce more with the same amount of resources and creates new markets and industries within an economy. However, the people who benefit the most from these technological innovations are those who are high-skilled workers. As the global economy continues to globalize and grow, there has been a noticeable shift in favor of those who develop skills and work in high-skilled labor markets.
a.) According to Adam Davidson in “Making it in America”, early technological improvements allowed a more favorable situation for those who were less skilled. Innovations such as steam and coal power started the shift …show more content…
Creative destruction can be described as “the driving force behind progress is the entrepreneur with an idea for a new product, a new way to produce an old product, or some other innovation.” As an innovative firm enters the market, it creates disruption within the market, resulting in loss of profitability to competitors. (Mankiw 2009). A relevant example of this in modern times would be the development of the ridesharing app Uber and its prominence in the personal transportation sector. The rise in the amount of smartphones capable of connecting to the internet has allowed Uber to directly connect with each consumer, allowing them to circumvent the government regulated monopoly of city taxies. While there is no way to directly overcome the negative side effects of creative destruction, there are ways that an individual can minimize their chance of encountering problems. For example, developing skills and knowledge that are difficult to automate would be considered an action that mitigates the chance that an individual’s job is lost due to the rise in automation in the workplace. This could be achieved by going back to school and getting a masters or doctorate degree. This option provides the opportunity to develop the critical thinking that are difficult to
a.) According to Adam Davidson in “Making it in America”, early technological improvements allowed a more favorable situation for those who were less skilled. Innovations such as steam and coal power started the shift …show more content…
Creative destruction can be described as “the driving force behind progress is the entrepreneur with an idea for a new product, a new way to produce an old product, or some other innovation.” As an innovative firm enters the market, it creates disruption within the market, resulting in loss of profitability to competitors. (Mankiw 2009). A relevant example of this in modern times would be the development of the ridesharing app Uber and its prominence in the personal transportation sector. The rise in the amount of smartphones capable of connecting to the internet has allowed Uber to directly connect with each consumer, allowing them to circumvent the government regulated monopoly of city taxies. While there is no way to directly overcome the negative side effects of creative destruction, there are ways that an individual can minimize their chance of encountering problems. For example, developing skills and knowledge that are difficult to automate would be considered an action that mitigates the chance that an individual’s job is lost due to the rise in automation in the workplace. This could be achieved by going back to school and getting a masters or doctorate degree. This option provides the opportunity to develop the critical thinking that are difficult to