As F. Stilwell said, there are six elements of structural economic change, which are: (1) application of new Technologies, (2) mergers and takeovers, (3) the globalisation of
production, (4) the reorganization of employment conditions, (5) changes in the economic
role of government, (6) changes in prevailing economic ideologies.
Firstly, I want to discuss the impact of changing Technology on production. Beyond
all question, when technological innovations pervade, the unemployment shows an
increase. And Stilwell says there are two overlapping waves. The first wave impacts
agriculture. Changing technology on agriculture impacts farmers. Farmers migrate cities
to find jobs in manufacturing industries. But changing technology on manufacturing
sector displace these workers, too. We can call the second wave as “McDonald’s Law”.
Like I just said, changing technology impacts manufacturing and it impacts
unemployment. But after all of these, “the changing technology” created a new sector
calls services sector. But the problem is what’s going to happen when information
Technologies and computerisation will begin to impact service sector, too? I think
unemployment will increase again and again, until “changing technology” will create a
new sector to exploit.
Secondly, I want to discuss globalization of production. Globalization expands
economic oppurtunities but it has side effects of course. As negative effects of
globalization, developed nations have outsourced manufacturing and white collar jobs.
That means less jobs for their people. This has happened because manufacturing work is
outsourced to developing nations like China where the cost of manufacturing goods and
wages are lower. Programmers, editors, scientists and accountants have lost their jobs due
to outsourcing to cheaper locations like India. So, we have to think twice before saying
“Globalization makes everything better”.
Lastly, I want to discuss changes in the economic role of government. According to
neo-liberalism, the role of government is nothing. The free market capitalism. For a long
time there are deregulation, privatisation and liberalisation of trade for more capital
movements. But the last crisis showed off deregulation and invisible hand not always
work. So maybe it’s time to make some changes on current economic systems. So that’s
the reason why we have to consider Political Economy.
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