Adjusting to Technological Change

Abstract

The subject of my address is adjusting to technological change, something that a lot of people are doing nowadays. The revolution in information and communication technologies and the transition to a knowledge-based economy are inducing people in every sector to change how they work and do business. What I want to emphasize is that these changes constitute a social process that involves more than the sum of our individual struggles with inanimate nature. People are adjusting not only to changes in technology but to changes that others are making to technology. Adjustments in one sector induce unexpected adjustments and innovations in other sectors in a complex process that none of the participants can possibly comprehend. The process is governed by social institutions, particularly by the business enterprises that organize almost all economic transactions in a modem economy, and at the same time it is transforming those institutions. A graphic account of how peoples' lives are being tossed about by the winds of change might be too depressing for this occasion. So to keep it light I am simply going to talk about macroeconomic theory. If there is one profession that has not yet seen much of the darker side of technological change, it is macroeconomic theory. In fact, the recent resurgence of interest in growth and technological change seems to have had a calming effect on the profession by diverting attention from the issues of unemployment, inflation, and aggregate-demand management that have been the subjects of the furious controversies since the Keynesian revolution. Peaceful coexistence has emerged between previously opposing schools, now united by the