In particular, the growth of the first industrial revolution accelerated growth from 1.5% to 3% a year in the UK (Source). Growth from electrification was 1.5% a year on average (source) and growth during the information industrialization was 3.5% a year (source).
I’ve heard economists comment that the IT revolution didn’t have any measurable impact on TFP, and we’re not working many more hours than we did 50 years ago, so how did IT have so much impact on growth?
Regarding the topic in general, it seems like for AI to have a big impact, it will have to break through the cost disease. Taking the coding example, if the AI can take on the roles of not just coding but project management, design, business etc, to create a complete software-solutions-in-a-box platform, then it can result in massive sector growth, cost savings, my unemployment, etc. But if AI only makes things cheaper that were already made massively cheaper by the first three industrial revolutions, then it will just make the cost disease worse.
I’ve heard economists comment that the IT revolution didn’t have any measurable impact on TFP, and we’re not working many more hours than we did 50 years ago, so how did IT have so much impact on growth?
Regarding the topic in general, it seems like for AI to have a big impact, it will have to break through the cost disease. Taking the coding example, if the AI can take on the roles of not just coding but project management, design, business etc, to create a complete software-solutions-in-a-box platform, then it can result in massive sector growth, cost savings, my unemployment, etc. But if AI only makes things cheaper that were already made massively cheaper by the first three industrial revolutions, then it will just make the cost disease worse.