undefined | Better HN

0 pointsETH_start1y ago0 comments

Much of the supposed decoupling between productivity growth and wage growth is a result of different standards of inflation being used for the two, and the two standards diverging over time:

https://www.brookings.edu/articles/sources-of-real-wage-stag...

There has been some increase in capital's share of income, but economic analyses show that the cause is rising rent and not any of the other usual suspects (e.g. tax cuts, IP law, technological disruption, regulatory barriers to competition, corporate consolidation, etc) (see Figure 3):

https://www.brookings.edu/wp-content/uploads/2016/07/2015a_r...

As for AI's effect on employment: it is no different at the fundamental level than any other form of automation. It will increase wages in proportion to the boost it provides to productivity.

Whatever it is that only humans can do, and is necessary in production, will always be the limiting factor in production levels. As new processes are opened up to automation, production will increase until all available human labor is occupied in its new role. And given the growing scarcity of human labor relative to the goods/services produced, wages (purchasing power, i.e. real wages) will increase.

For the typical human to be incapable of earning income, there has to be no unautomatable activity that a typical person can do that has market value. If that were to happen, we would have human-like AI, and we would have much bigger things to worry about than unemployment.

I think it's pretty unlikely that human-like AI will be developed, as I believe that both governments and companies would recognize that it would be an extremely dangerous asset for any party to attempt to own. Thus I don't see any economic incentive emerging to produce it.

0 comments

danans1y ago

> There has been some increase in capital's share of income, but economic analyses show that the cause is rising rent and not any of the other usual suspects (e.g. tax cuts, IP law, technological disruption, regulatory barriers to competition, corporate consolidation, etc) (see Figure 3):

> https://www.brookings.edu/wp-content/uploads/2016/07/2015a_r...

The paper referenced by the that article excludes short term asset (i.e. software) depreciation, interest, and dividends before calculating capital's share. If you ignore most of the methods of distributing gains to capital to it's owners, it will appear as though capital (at this point scoped down to the company itself) has very little gains.

The paper (from 2015) goes on to predict that labor's share will rise going forward. With the brief exception of the COVID redistribution programs, it has done the opposite, and trended downwards over the last 10 years.

> I believe that both governments and companies would recognize that it would be an extremely dangerous asset for any party to attempt to own.

We can debate endlessly about our predictions about AIs impact on employment, but the above is where I think you might be too hopeful.

AI is an arms race. No other arms race in human history has resulted in any party deciding "that's enough, we'd be better off without this", from the bronze age (probably earlier) through to the nuclear weapons age. I don't see a reason for AI to be treated any differently.

ETH_startOP1y ago

The study does not exclude interest and dividends. It still captures them indirectly by looking at net capital income.

>AI is an arms race.

What I'm trying to convey is that the types of capabilities that humans will always uniquely maintain are the type that is not profitable for private companies to develop in AI because they are traits that make the AI independent and less likely to follow instructions and act in a safe manner.

j / k navigate · click thread line to collapse