Which is true?
Which is true?
When the intrinsic unit cost of production decreases, the same amount of capital can be used to produce more units, and the price per unit can be lowered (or else the profit per unit is increased). To that extent, rising productivity is always beneficial.
However, there is more than one way to achieve increased productivity, some of which cause net harm to the economy. I think the problem here is that a distinction needs to be made between the concept of "lowering the intrinsic unit cost of production" and "increasing the ratio of units produced to hours worked." I have been addressing the latter, and I suspect that you and Southack have been addressing the former. The distinction is crucial.
To simply find a way to use the same resources (including people) to produce widgets more cheaply is one thing. To fire all your workers, and stop doing business with all your vendors, because you have a magic device that produces as many widgets as you want very cheaply, is another. The first case is unquestionably very beneficial. The second case very well may not be--especially at first.
Of course, the official productivity numbers measure the ratio of units produced to hours worked, and not the intrinsic unit cost of production. This is why I am not impressed by the productivity figures. I don't believe they mean anything other than that the less effective workers have been fired, the less efficient machines have been mothballed, and the most costly factories have been shut down.
In an economic expansion, as demand outstrips supply, ever more marginal workers get hired, the less efficient machines come on line, and the more costly factories restart production--with decreased productivity as the result. Nevertheless, this is widely viewed as positive. And that should answer your question.