Productivity: effects on standard of living
About this video
The video compares two farming villages: one where people work fields by hand and one where robots, tractors and solar panels make each hour of work far more productive. It explains that higher productivity creates more wealth in less time, which people can use for more wealth, more leisure, or both, raising their standard of living.
You'll be able to
- explain productivity as how much output a person can produce per hour of work.
- describe how higher productivity can raise a society's standard of living.
- explain why a productive society can buy goods it does not make itself.
Key words
- Productivity
- How much output someone can produce for each hour they work.
- Standard of living
- How well people live, including their wealth, comfort and free time.
- Leisure
- Free time that is not spent working.
- Wealth
- The money, goods and resources people have.
- Automated
- Done by machines or robots instead of by hand.
Transcript
- [Instructor] So taking a look at these two pictures, which show two different villages and they're both agricultural villages, what major differences do you see in terms of how people are actually able to grow things and how well they live and how hard they are probably working in each of these?
Well, when I see the image on the left, I see a lot of manual labor here. People are by hand working the field, maybe a little bit of help from some animals over here. So they're spending most of their time working just to get by. And they don't have great resources, they don't have a lot of wealth.
These houses look like they were also very handmade with some type of straw or thatch or something like that. So they don't have what we would call a high standard of living. They don't have a lot of leisure, they don't have a lot of wealth. Now, if we look at this village on the right, you could almost imagine, we could hope that this village on the left becomes this village on the right, in maybe a few hundred years.
We see something different. We're still growing things, but it has been significantly automated and we see more productivity or we can assume that there is more productivity. Per hour that someone works it looks like that person can produce a lot more output. Mainly because in this fairly extreme situation, you have robots here.
These are robots. These aren't people, and even the robots are driving tractors to make themselves even more productive. They have electrical sources like solar panels. That one, probably helped charge and power the robots that help drive productivity, but it also gives them a higher standard of living.
We can imagine that inside these homes you have big screen TVs and air conditioning, and when it rains, water doesn't drip through like we have on the left hand side. And even if this society isn't directly producing the solar panels or producing the materials for this housing because they're so productive in terms of what they grow, they have more wealth to trade with and buy other things.
We can also see, and I don't think these are robots here, I actually created this with AI is talking about, you know, mentioning productivity. AI has made me more productive on these videos to be able to create images like this. But we see, I asked the AI to say, hey, show this wealthier society having leisure.
We can see them just hanging out under the umbrella, enjoying life a little bit. You don't see that happening on the left village where people are less productive. So generally speaking, the more productivity you have that tend to generate more wealth in less time.
So it generates wealth and leisure because you could either work the same amount and just have a lot more wealth or maybe even work a little bit less and still have the same wealth or more, and now you have more time for yourself, for your family, et cetera. And that's the type of thing that increases your standard of living.
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