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Russ Roberts and I talked for over 90 minutes on the possibility of a future robot-induced “singularity”, i.e., a sudden drastic social change, including a much faster growth rate. As this was his longest podcast in over two years, Russ seems to have been quite engaged by the subject.
Russ said “This may all sound crazy but Robin makes it actually sound plausible.” His two main points of skepticism were:
I say our brains are big piles of brain cells that send signals to each other. We’ve know what parts the brain is made of, and they are the same familiar parts that everything else around us is made of. We know well how these parts interact locally, though figuring out what this implies on large scales is usually beyond our calculation abilities. So a good enough model of the parts and how they are connected must reproduce the same overall input-output behavior. Russ says “there is a reductionist element to this which says–and this is controversial–all there is to our brain is its physicality. Nothing else there. That’s not universally accepted, correct? … Being a religious person I’m capable of imagining something that is not observable.”
I say prices usually fall when a very elastic supply curve rapidly gets cheaper. Russ would probably agree for something like computer memory, but is reluctant to agree for wages – he doesn’t think cheap plentiful immigrants lower wages. I say that if trillions of immigrants willing to work for a dollar an hour were waiting just offshore, letting in as many as wanted in would lower wages to that level. So I say cheap robots getting cheaper fast should rapidly lower wages for tasks they do. Russ objects “You can’t just say your wage will be driven down, because if there are complementary types of labor they’ll increase the wage rate of some people. … There’s all these complicated secondary effects.” I say all things considered, the likely effect is falling wages.
The first point reminds me of my disagreements with Tyler:
The three items on which Tyler most clearly identifies a disagreement [with me] are all in hard science and technology … Tyler doesn’t know that much about hard science and technology. … And yet Tyler feels confident enough in his perception of expert consensus on such topics to base his disagreements with me on them, even though I’ve spend years in such area.
The second point seems easier to settle, as it is just an application of standard econ theory. Any other economists care to weigh in?
Added 5Jan: Karl Smith, Nick Rowe , Steven Hsu weigh in.
Roberts On Robots
Regarding the economic question, we have some experience with this, but I'm not sure what it tells us. ~1900 when machines took over from human muscles did labor costs go down? In the 1980s as computers took over for clerical work did clerical pay go down? It doesn't seem in either case that wages dropped particularly. Meanwhile, there is presumably a long term trend that all the production gets spread between all the humans. If production goes up because of robots, then the increased production has to be split between1) Labor2) Capital3) ? Robots ?
I suspect it is politically unstable for the excess production from robots to go to capital without some going to labor. Capital formation and posessions is a function of the laws, and the laws can change. Obviously our legals sytems have always allowed some share of production to capital, enough to allow capital to be accumulated, but the broad sweep is that capital tends not to be accumulated by families for more than a few generations. If Robots are THAT productive and are still not people, I believe the political solution will be to allocate the excess production between their owners and the rest of the population. Heck maybe they will be publicly owned, like the beaches in california or the monopoly on lotteries or the road system.
BUt it doesn't seem the public record is that productive innovations that displace labor permanently reduce the wages to labor. Rather the opposite, the wages to labor have continued to rise even as productive innovations have in a micro-sense competed labor away.
Russ Roberts positions are constrained by his autistic support of unilateral free trade and open borders. In the absence of actual evidence, he has written novels and fables to support those positions, which signal his status and loyalty to the old high priesthood of academic economics, but also, since a writer's books are his babies, make it very difficult for him to support any argument that would betray them.