Were the Luddites Right?

The Luddites were a 19th century anti-industrialisation movement (and militia), who believed that their jobs were at risk because of the industrialisation of manufacturing. They proceeded to try and destroy mechanical looms in a vain attempt to turn back the rising tide of industrialisation. These days anyone seen as a "Luddite" is perceived to be backward and anti-technology.

But were the Luddites right about the consequences of technological progress? The Luddite Fallacy states that the argument that technological progress decreases the amount of jobs is fallacious, because increases in productivity does not mean that employers will keep their production constant. Rather, employers will increase their production to suit available demand.

The Economist has a post that points out that the Luddite Fallacy is only a fallacy as long as new technology increases capital, without reducing the need for human labour. But what happens if technology increases the capital and replaces the need for unskilled human labour?

The Luddites may have been a revolution or two short of the mark, springing from the industrial rather than the computer revolution, but maybe they weren't wrong about the long-term consequences of technological progress, believing that it would destroy jobs, and cause greater income inequality. Smashing the looms is obviously not a solution to the socio-economic problems of the structural changes to our society, but neither is burying our heads in the sand.