How does this thing called creative destruction, or people losing their jobs, actually create more jobs, expand the economy, and make everyone better off?

Creative video from Prof. Bryan Caplan explains Make Progress, Not Work.

[youtube=http://www.youtube.com/watch?feature=player_embedded&v=fEbdgpIQ7n4]

 

A few highlights:

It may be terrible for someone who loses a job because there isn’t work for them to do, but that frees the person up to do more productive work.

As the tractors replace horses and lots of farmers have to move off the farm, we don’t say ‘let’s build an industrial powerhouse and make everyone wealthier’. We don’t do that because we can’t see innovation and progress before it happens.

Also, laws making it difficult to lay off people make employers hesitant to hire in the first place.

Check out the video for a far better explanation in four minutes than I can provide in a hundred words.

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