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Econ: How does Technology Change Market Efficiency? 6 Views


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Description:

How does technology change market efficiency? Technology makes the market more efficient by giving investors the ability to execute trades in the market much easier and faster. Using computer systems to enter trades gives investors the ability to make trades at the exact price they wanted and gives them the details of their trade immediately. Technology also gives investors access to more information through financial research websites such that they can make more informed decisions before investing.

Language:
English Language

Transcript

00:00

And finance Allah shmoop What is technological change Well let's

00:08

see We all benefit from technology Just think about it

00:11

We're talking to you through time and space thanks to

00:14

a little thing called the Internet Yeah great No big

00:17

deal In economics technological change is used to describe anything

00:21

that increases output without increasing input In other words technological

00:26

changes magic It's anything that makes creating economic value more

00:31

efficient like the Internet and computers are tools that we

00:35

often think of when we hear technology But changes in

00:37

processes count as technology as well For instance the invention

00:41

of the assembly line and great process there was first

00:44

put into play by Henry Ford in the late nineteen

00:47

twenties and it was the key to making mass production

00:50

possible By combining the use of machines with stationed workers

00:54

and interchangeable parts Ford was able to produce far more

00:58

vehicles with the same amount of inputs as before Even

01:01

hammers wristwatches and dialogue were once leading technological change Today

01:06

we've got self driving cars flying cars three D printing

01:10

and neural network development increasing market efficiency and well yes

01:14

Granted our relationship with technology has never been straightforward in

01:18

the case of the assembly line While workers in Ford's

01:20

factories did have better working conditions In some ways they

01:23

had worse working conditions In other ways workers didn't have

01:27

to do any heavy lifting or low stooping like they

01:29

did before And there were jobs almost anyone could dio

01:33

plus the assembly line allowed for to pass on some

01:35

of those efficiency gains from technological change to workers wage

01:39

improvements Despite these benefits the turnover at Ford's assembly line

01:43

jobs was incredibly high For a while workers could on

01:46

Lee do the mind numbing jobs for so long It

01:49

was also argued by Karl Marx that doing the same

01:52

little repetitive task over and over and over again made

01:55

it difficult for workers to feel like they were actually

01:57

contributing anything meaningful in their jobs Well guess what The

02:01

turnover at Ford's factories was so high that Ford decided

02:04

to give his workers two days off working only five

02:07

days a week eight hours a day What a concept

02:10

That's right The technological change of assembly lines lead to

02:13

increased market efficiency and supreme boredom among workers which then

02:17

led to the forty hour work week who go forward

02:21

Increasingly these repetitive type tasks are being done by advanced

02:25

robots Even more creative jobs like writing for shmoop and

02:29

making music composition are now being done by robots It's

02:33

nothing personal It just makes sense for business to use

02:35

more robots If doing so allows them to doom or

02:38

with less well as technological change progresses it's increasingly a

02:42

concern that robots will take up so many jobs There

02:46

won't be many left for a human Beings will have

02:49

a huge part of the workforce just permanently unemployed then

02:52

Plus most economic gains from technological change in the last

02:54

several decades haven't ended up in workers pockets which is

02:58

kind of a concern We've always had a love hate

03:00

relationship with technological change We love how easy it makes

03:03

our lives but sometimes it makes them too easy can't

03:06

live with robots and well can't live without him What

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