Suck it down or blow it off. Your Choice.

Does efficiency cause price increases? I’m thinking about industry level efficiencies. Super efficient cow udders, ultra-high per acre crop yields and child educating processes, for example.

Do these sorts of efficiencies have optimum levels beyond which we see diminishing returns and, perhaps, parallel unintended consequences that negate advantages gained by incresed efficiencies?

Milk production has gotten more efficient within individual animal units; pounds of milk coming out of X pounds of corn has gone up on average. Tons of corn produced on an acre of dirt has gone up on average. Acres worked per farmer has increased on average. So if you measure only these fairly significant increases in “efficiencies”, why do I pay nearly $5 for a gallon of milk and the farmers are still poor.

Because the so called efficiencies must have hidden unintended consequences. Right? Most likely there are undiscussed shifts in costs, deceiving us into thinking we’re seeing increased efficiencies when we are actually absorbing the cost somewhere else.

I think so.

Can you think of examples?

How about this blog entry? Using a very small (handheld, even!) device I was able to write most of the post before getting out of bed! So many entries per hour! Yay! I can even write on the crapper. But that just shifts the cost to the reader, doesn’t it?