YouTube Economics

It's well-known that I'm a nerd. I enjoy documentaries and non-fiction books I can borrow from the library. In the past year I've also discovered the preponderance of documentaries and educational videos on YouTube. What do you want to learn more about? You can find it on YouTube.

But as I learn about card weaving and the growing of flax, as I watch a young mom of five share life hacks for kitchen and laundry, as I follow John and Hank Green, I think about the many, many people who choose to make a living with YouTube videos and blogs.

Hank and John Green of vlogbrothers use their 3-4 minutes videos to grow an audience, and this audience participates in conventions and the Project for Awesome and buy the brothers' books. I'm not sure the vlogs are their sole means of income, but the brothers definitely make money from it.

Jordan Page creates videos featuring life hacks and uses her YouTube channel to promote her blog. That's where her money is made -- the advertising on her blog and getting you to purchase her financial independence merchandise.

The Green brothers and Jordan Page use YouTube to promote something else, a service or a product. YouTube becomes almost an advertising platform.

But of the top 10 earners on YouTube, six of them feature twenty-somethings playing video games and one is a 7-year-old opening and reviewing toys. These people are all earning over $10 million a year.

I'm not complaining about the amount of money they're earning. I'm not even saying they don't earn their money; I know creating and editing these videos takes many hours and can be quite involved.

I am concerned that this promotes an economy that doesn't produce anything. They are making money as entertainers. (And when I am entertained, they do their job well.) But what will happen to an economy, in the long run, when everyone is an entertainer?

Thomas Jefferson wanted the US to be an agrarian society, growing just enough to live on but not really exporting goods. Andrew Hamilton won that discussion, and America became a manufacturer of textiles, steel, and food products that could now be shipped far distances because they could be preserved. By the twentieth century, we had wide-ranging industries that included vehicles (Ford), food products (Kellogg and Coca-Cola), and eventually computer technology (Hewlett-Packer was one of the first and most influential).

Enter the twenty-first century, and we live in what economists call the Information Age or a Knowledge-based Economy. Instead of manual laborers using their hands to create something or provide a service, knowledge workers use their minds to produce ideas and knowledge.

Here's the thing to remember about manual laborers versus knowledge workers. We'll always need auto mechanics and plumbers. My job, however, working in a call center, can easily be outsourced to another country. Obviously: knowledge has no boundaries. Sounds good.

I'm not an economist. But I worry about an economy where everybody earns their income without making something. If the economy crashes, people will still need food, transportation, and non-leaky homes. They won't spend their money on entertainment. Then where will we be?

This is something to think about, but I don't have an answer for it. I would welcome a discussion. What are your thoughts?