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Comment by Anotheroneagain | Hacker News Reader

The hypothesis in the article is false because of the simple fact that cheap labor also means cheap labor for making the machines. And vice versa it can't be more profitable to make machines because the wages are high, as high wages would make the machines more costly as well.

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You are ignoring the raw resource costs. The raw resource costs of humans is very low, it is really hard for early machines to compete with that, burning wheat in a machine instead of feeding more humans is really wasteful.

Its only when you put enforce minimum standards for all humans that humans starts to cost, and its only when you start to dig up fossil fuels that you start to have excess energy for your machines compared to feeding humans. Without those two the natural resource cost of machines is immense relative other things.

Same thing. My point is that the cost of the digging up is proportional to the cost of the diggers. Cheap labor digs up the fossil fuels cheaply. It isn't that labor becomes expensive for everything else except for the machines, and the fuel for them.

> Cheap labor digs up the fossil fuels cheaply

Only if you have fossil fuel to dig up though. To do that you need to have identified where it is and build the infrastructure and skills to be able to dig it up.

Coal mines are far from everywhere, without them you would have to grow fuel and thus compete with human food.

What makes the machines expensive is (as the article says) the capital cost. An investor must sink a considerable amount of money into producing or obtaining a machine before any money is made, that money is now locked up until the machine (with a limited lifespan) turns a profit, at the cost of not making better investments elsewhere.

The cost of the machine is proportional to the cost of labor needed to make it. Cheap labor means cheap machines, expensive labor means expensive machines.

What about resources needed to make the machine?

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