By Michael Matulef
For more than two centuries, the doomsday crowd has claimed that capital development will create mass unemployment. And for two centuries, they have been wrong. The same goes for artificial intelligence.
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Major theme of my microeconomics class in the past two semesters. Been showing them all sorts of models and frameworks for why productivity enhancing technologies don't automatically imply lower steady state employment. Pretty easy to write down a model where the effect of technology is reflected entirely in lower commodity prices and higher commodity output, without any long run effect on the labor market.
The version I do worry about a little is the idea that the minimal intelligence threshold for employment is rising: i.e. there's a growing segment of the population that's just not smart enough to provide sufficient value to others in a modern economy to earn a subsistence wage.
I don't think I worry about this too much... people will always find a way to provide value to each other, one way or another.
But if we take your premise as given, and more people can't earn a subsistence wage in a competitive labor market, then we probaly will end up with more UBI-style social programs, on the logic of:
I agree and I don't have this as my most likely scenario, just one that seems plausible and unfortunate.