Because what you are calling "local benefits to industrial expertise" is ultimately realized in the form of returns on capital.

Whether these benefits outweigh the costs is an open question.

When the tech industry's growth was very talent constrained as it was in the last few decades, arguably opening labor competition had the effect of increasing overall growth (mainly through new production invention). The list of immigrant technologists who have created new technologies and products - and jobs as a result - could probably fill an encyclopedia.

It's unknown whether that type of growth - the kind that creates more and better jobs - will continue, especially given recent developments in AI.

If the benefits going forward are largely going to be based on massive increases in labor efficiency, then it's not as clear that the benefits (mostly to capital) outweigh the costs (mostly to labor). Most business models in AI are predicated on replacing people, who are expensive, not making more or better goods. Sure, we'll get some neat robots along the way that actually make stuff, but that will likely be a small fraction of the money to be made.

Or perhaps we are at the dawn of a new era of technology which will make more and better jobs. We'll see.

Subtracting depreciation isn't a fair comparison. The example uses software as a short-lived asset. Has the monetary value of Google's search algorithms depreciated? They've been upgraded with routine investment, but the scale of the returns on their upkeep vastly outweighs the capital investment, otherwise Google wouldn't be so profitable.

Software of the internally-developed sort isn't even depreciable [1], so it's not clear how its value for these purposes would be determined (short of assuming it represents a percentage of the business's value).

Also, from the paper linked in your article:

> Once all compensation of employees at the sawmill is subtracted, the remainder is its gross capital income. Some of this capital income will be paid to lenders in the form of interest, some will be paid to the government in taxes on profits, and the rest may be retained on the balance sheet of the sawmill or distributed as dividends to shareholders. Gross capital income is thus a very broad concept, encompassing funds that are ultimately paid out to many different recipients—it is unaffected, for instance, by the split in financing between debt and equity.3 GROSS VERSUS NET: CONCEPTS An alternative to gross value-added is net value-added, which subtracts depreciation. This can be divided into labor and net capital income, the latter being gross capital income minus depreciation.

Everything which I have emphasized above are examples of returns to capital. Excluding them from consideration in this presentation is ignoring how a large amount of returns are channeled to owners of capital.

Debt-holders gain from interest and shareholders are enriched via dividends and share buybacks that never appear on the article's net income derived graph.

Of course, when you willfully ignore those huge tranches of returns, then housing looks like a major factor, because it is the common asset class that has been on a largely unchecked inflationary track.

Finally, your article from 2015 argues that the overall trend will reverse and labor's share of GDP will start increasing. Here's what has actually happened since then:

https://fred.stlouisfed.org/series/PRS85006173

The brief spike in 2020 was due to pandemic era redistribution policies like the child tax credit, among others. Since those have been repealed, labor's share has continued its prior trend downwards.

1. https://www.irs.gov/publications/p946#en_US_2023_publink1000...

When my companies have produced more output from the same inputs (or the same output from less inputs in the case of mass layoffs), we return the cash to shareholders by way of a stock buyback or special dividend the following quarter.

Maybe in some companies they instead give workers raises or outsize holiday bonuses, but I’ve never seen this.

Power.

Political power: policies written to benefit the highest bidder.

Financial power: more leverage in being able to dictate terms of borrowing by workers - and being able to force the government to borrow from capitalists instead of levying taxes on them.

Physical power: Being able to buy/influence law enforcement (themselves a type of worker) to protect the capitalist's interests over those of other workers.