The economy is a complex adaptative system which, like all complex adaptive systems, can handle perturbations over the same timescale as the interal homostatic processes. Beyond that regime, the system will not adapt. If I tap your head, you’re fine. If you knock you with an anvil, you’re dead.
Yes, absolutely. The question is where that line lies for each combination of system + perturbation. I agree with most of your claims in the article—just not the claim that each AI iteration is sufficiently different from an economic perspective as to require it’s own independent 5-10 yr adjustment period. MMy guess is that some companies will start earlier and some later, some will copy best practices and not bother with some generations/iterations, and that this specific issue will not be more of a problem than, say, Europe and then Japan rebuilding after WWII with more modern factories and steel mills and so on than America had. Probably less, since the software is all handled on the back end and the costs of switching should be relatively low.
Countries that were on the frontier of the Industrial Revolution underwent massive economic, social, and political shocks, and it would’ve been better if the change had been smoothed over about double the duration.
Countries that industrialised later also underwent severe shocks, but at least they could copy the solutions to those shocks along with the technology.
Novel general-purpose technology introduces problems, and there is a maximum rate at which problems can be fixed by the internal homeostasis of society. That maximum rate is, I claim, at least 5–10 years for ChatGPT-3.5.
ChatGPT-3.5 would’ve led to maybe a 10% reallocation of labour — this figure doesn’t just include directly automated jobs, but also all the second- and third-order effects. ChatGPT-4, marginal on ChatGPT-3.5 would’ve led to maybe a 4% reallocation of labour.
It’s better to “flatten the curve” of labour reallocation over 5–10 years rather than 3 months because massive economic shocks (e.g. unemployment) have socio-economic risks and costs.
That’s possible. Have you read Robin Hanson’s 2000 paper on economic growth over the past 2 million years? If not, you might find it interesting. Talks in part about how new modes of spreading knowledge and invention may explain past transitions in the economic growth rate.
It doesn’t mention AI at all (though Hanson has made the connection multiple times since), but does say that if the data series trend continues, that suggests a possible transition to a new growth mode some time in the next couple of decades with a doubling time of a few days to a few years. To me, AI in some form seems like a reasonable candidate for that, to the extent it can take human limits on adaptation speed out of the equation.
The economy is a complex adaptative system which, like all complex adaptive systems, can handle perturbations over the same timescale as the interal homostatic processes. Beyond that regime, the system will not adapt. If I tap your head, you’re fine. If you knock you with an anvil, you’re dead.
Yes, absolutely. The question is where that line lies for each combination of system + perturbation. I agree with most of your claims in the article—just not the claim that each AI iteration is sufficiently different from an economic perspective as to require it’s own independent 5-10 yr adjustment period. MMy guess is that some companies will start earlier and some later, some will copy best practices and not bother with some generations/iterations, and that this specific issue will not be more of a problem than, say, Europe and then Japan rebuilding after WWII with more modern factories and steel mills and so on than America had. Probably less, since the software is all handled on the back end and the costs of switching should be relatively low.
Countries that were on the frontier of the Industrial Revolution underwent massive economic, social, and political shocks, and it would’ve been better if the change had been smoothed over about double the duration.
Countries that industrialised later also underwent severe shocks, but at least they could copy the solutions to those shocks along with the technology.
Novel general-purpose technology introduces problems, and there is a maximum rate at which problems can be fixed by the internal homeostasis of society. That maximum rate is, I claim, at least 5–10 years for ChatGPT-3.5.
ChatGPT-3.5 would’ve led to maybe a 10% reallocation of labour — this figure doesn’t just include directly automated jobs, but also all the second- and third-order effects. ChatGPT-4, marginal on ChatGPT-3.5 would’ve led to maybe a 4% reallocation of labour.
It’s better to “flatten the curve” of labour reallocation over 5–10 years rather than 3 months because massive economic shocks (e.g. unemployment) have socio-economic risks and costs.
That’s possible. Have you read Robin Hanson’s 2000 paper on economic growth over the past 2 million years? If not, you might find it interesting. Talks in part about how new modes of spreading knowledge and invention may explain past transitions in the economic growth rate.
It doesn’t mention AI at all (though Hanson has made the connection multiple times since), but does say that if the data series trend continues, that suggests a possible transition to a new growth mode some time in the next couple of decades with a doubling time of a few days to a few years. To me, AI in some form seems like a reasonable candidate for that, to the extent it can take human limits on adaptation speed out of the equation.