Question: Many fear that computers will do to humans what tractors and cars did to horses-the horse population declined precipitously early in this century after technological

Many fear that computers will do to humans what tractors and cars did to horses-the horse population declined precipitously early in this century after technological change made horses obsolete. If we treat computers as a particularly productive kind of K, what would their introduction do to the capital-labor ratio in Figure 25-3? Can total output go down with a fixed labor force? Under what conditions would the real wage decline? Can you see why the horse analogy might not apply?

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