What is the Impact of AI on the economy?
At the recently concluded Bletchley Park summit on Artificial Intelligence (AI), in an interview with the U.K. Prime Minister Rishi Sunak, billionaire Elon Musk highlighted the disruptive potential of AI.
AI generates new jobs in turn, for instance AI programmers.
The history of economic thought reveals different ways in which a human’s relation with work has been theorised.
John Maynard Keynes was a liberal thinker who extolled capitalism but wished to save it from its worst excesses.
He believed that at its heart, work represented a form of drudgery, and a world in which the hours of work could be reduced was one that unequivocally increased welfare.
Keynes theorised that technological change under capitalism would eventually lead to a reduction of working hours.
Mr. Musk’s comments can be seen as an extension of Keynes’ thinking, where improvements in technological change, if taken to its theoretical extreme, could eliminate the need for work altogether, representing an unambiguous positive outcome.
Karl Marx had a more nuanced analysis, the essence of humanity lies in our ability to materially manipulate nature; work therefore provides meaning to human life.
The problem arises within the economic system of capitalism, as the product of human labour is not the labourers’ to enjoy, but is seen as the property of capital to dispose of in the market for profit.
Capitalism, in this reading, causes humanity to lose touch with the one activity that provides self-fulfilment.
In contrast to Keynes’ view, the elimination of work does not imply an elimination of drudgery, but the elimination of the only activity that gives human life meaning.
In Karl Marx’s view, the ideal state is not one where AI replaces human labour, but where individuals can utilise AI to enjoy and elevate their work, without it being appropriated by someone else.
The impact of AI on the economy
One may disagree with Keynes’ notion that decreasing working hours will always increase welfare, for the working world does provide valuable social networks for many.
At the same time, one can critique Marx’s view of humanity finding meaning through work, for it does not allow us to conceptualise any kind of future without work at the centre.
Yet the views of the above thinkers reveal an important problem in the current discussions around AI — the neglect of the economic system.
Under our current system of capitalism, the only way an individual can access material resources such as food and shelter is through income derived from work.
In such a system, a world without work does not imply a world without drudgery, but one where individuals who cannot find work cannot access basic resources.
A world without work
Imagine an economy where a part of the surplus generated in the productive sphere — where AI is the only productive factor — is transferred to human individuals to meet their basic needs.
There is nothing wrong, of course, with postulating such a world.
But this is not a capitalist world. It is a world with very different institutional arrangements regulating production and distribution.
This throws up several important questions, such as what determines the amount individuals receive, what determines the division of the net product between those who own the machines and those who don’t and what determines the division between future growth versus current consumption.
A situation where AI reigns supreme may never come to pass, and one may dismiss this article as speculative fiction.
Yet the world economy will face disruptions, and it is imperative for us to fully understand the nature of these challenges.
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