Just as individuals once depended on agrarian societies for incremental growth, personal time value as a resource, needs more definable forms of incremental and ongoing supply at local levels as well, in the present. Unfortunately, however, this important service product option is held back by static versions of knowledge use, as today's institutions cope with a definition of services productivity in need of a 21st century update.
As a result, many aspects of knowledge use have become overly dependent on private industry and government, as benefactors. Consider how even in a time of slow progress, labor quality growth has been strong in the past fifteen years, although it is now expected to decline in the coming decade. In the above linked working paper from the Fed, the authors note:
Strikingly, the growth and acceleration of labor quality since 2002 has a very different source than it did in the half century before that. In the 20th century, the primary driver of labor quality increases was rising educational attainment. In contrast, since 2002, the source of labor-quality growth has been a shift in the composition of employment away from low skilled and toward higher skilled workers.
...Our work reinforces the view that labor-quality growth will add less to growth in productivity and output than it has historically. That said, the actual path of labor-quality is sensitive to uncertainties about trends in employment rates and, to a lesser extent, educational attainment. These differences will show up in productivity growth, but whether they matter for output growth depends on the degree to which they are offset by hours growth. This highlights a takeaway from our analysis, namely that labor-quality growth and hours growth are often negatively correlated. An important implication of this is that forecasts of overall labor input growth, or quality adjusted hours, are preferable to independent projections of labor quality and hours.Notice the tension in what is sought and what appears as though possible, in terms of productivity and hours in the above quotes. And for the most part, work indicative of productivity gains has been more closely aligned with higher income levels, as opposed to aggregate hour quantity. Yet how does this square with the fact that a broader range of population needs economic participation in the near future, for a longer duration in the course of their lifetimes? Is it possible to achieve outcomes with relative gains for knowledge use, without substantial losses in productivity and quality labor? Again, consider the tension in the fact that education now provides diminishing returns, even though it has provided the most logical course of action for greater productivity gains over time.
At root, there is a growing problem with asymmetric compensation for desired levels of productivity (in standard terms), and the resource sources (in aggregate) this form of compensation has benefited from, for so long. Present day education investment structures have been structured along the same lines of wage and income expectation, in terms of personal commitment and responsibility. Even though higher education is still perceived as vitally important for economic access, a higher degree of investment risk is involved, as institutions find themselves in the odd position of suppressing applied knowledge use in real time where possible, to maintain standard productivity outcomes and budgetary needs.
There's a way to overcome this problem. But in order to do so, time value needs to become more closely linked with group coordination and asset formation, to alleviate the lack of resource capacity which contributed to high level income representation for so long. Otherwise, recent gains in skill quality and time investment could be lost, as individuals shift toward more basic and less productive means of survival, should they lack sufficient economic access to remaining knowledge based work. It is all the more important to prioritize new wealth creation and output in time based services product, since services also play a greater role than manufacture in overall demand levels.
Symmetric compensation could eventually support high skill knowledge use, without the extensive resource capacity and investment which is necessary now. The need for symmetric knowledge compensation is becoming more important, as an ever growing percentage of today's asymmetrically compensated capacity is now designated as response to emergency circumstance and settings. Such default settings for knowledge use, leave little remaining compensation (from discretionary income and redistribution) for daily maintenance and ongoing knowledge functions.
What if knowledge use were to become more scarce, than what is presently relied on? Indeed, the Fed paper linked above, seemed to worry about that possibility. Is knowledge wealth more fragile than it seems, when it is mostly defined through the value of knowledge providers who came to define the most important boundaries of knowledge rent and use? Once, knowledge in its infinite variety, experience and usefulness, seemed as free as the air we breathe and the water we drink. A quote from David Ricardo inspired this post, and I have included it below. Some may also recognize his quote as my own (somewhat hackneyed) attempts to explain, how time aggregates as a whole are diminished by the definition of healthcare provision:
It is true that a man in possession of a scarce quantity is richer, if by means of it he can command more of the necessities and enjoyments of human life, but as the general stock out of which each man's riches are drawn is diminished in quantity by all that any individual takes from it, other man's shares must necessarily be reduced in proportion as this favored individual is able to appropriate a greater quantity to himself.
Let water become scarce, says Lord Lauderdale, and be exclusively possessed by an individual, and you will increase his riches, because water will then have value; and if wealth be the aggregate of individual riches, you will by the same means also increase wealth. You undoubtedly will increase the riches of this individual, but insamuch as the farmer must sell a part of his corn, the shoemaker a part of his shoes, and all men give up a portion of their possessions for the sole purpose of supplying themselves with water, which they before had for nothing, they are poorer by the whole quantity of commodities which they are obliged to devote to this purpose, and the proprietor of water is benefited precisely by the amount of their loss. The same quantity of water, and the same quantity of commodities, are enjoyed by the whole society, but they are differently distributed. This is, however, supposing rather that a monopoly of water than a scarcity of it. If it should be scarce, then the riches of the country and of individuals would actually be diminished, insamuch as it would be deprived of a portion of one of its enjoyments. The farmer would not only have less corn to exchange for the other commodities which might be necessary or desirable to him, but he, and every other individual, would be abridged in the enjoyment of one of the most essential of their comforts. Not only would there be a different distribution of riches, but an actual loss of wealth.