The Influence of Productivity on Economic Welfare
It is a well-known old thesis that an increase in labour productivity leads to an increase in economic " welfare." Assuming for a while that the meaning of these two concepts is clear, we may say that the statement is correct for a Robinson Crusoe economy as we know it from our books. If Crusoe can get more products for the same effort, then probably he will shorten somewhat his working-day and get more products, and by doing so feel happier. The statement seems guaranteed for an economy : (i)without foreign trade, (ii) without working-hours regulations, (iii) without problems of capital scarcity and (iv) without monetary complications.