RE: Economic Growth Given Machine Intelligence

From: mike99 (
Date: Wed May 12 2004 - 16:20:22 MDT

Prof. Hanson's paper both predicts economic effects of future artificial
intelligence as well as the current effects of computerized automation of
jobs formerly performed by humans that we are witnessing today. In the
Abstract to his paper, Hanson writes:

"Eventually, computers do most jobs. At first, complementary effects
dominate, and human wages rise with computer productivity. But eventually
substitution can dominate, making wages fall as fast as computer prices now
do. An intelligence population explosion makes per-intelligence consumption
fall this fast, while economic growth rates rise by an order of magnitude or
more. These results are robust to automating incrementally, and to
distinguishing hardware, software, and human capital from other forms of

If Hanson is correct and wages fall as fast as computer prices do now, we
are in for a bumpy ride during a historical transition period. (For purposes
of this discussion, let's stipulate that computer prices fall slower than
Moore's Law but track that Law.) Since consumption depends on income (which
is mostly wages for most "people," or as Hanson has it, "intelligences"
including non-human ones) then per capita consumption will drop. However,
with the "intelligence population explosion" Hanson predicts, there may be
so many more new intelligences that aggregate consumption will increase
enormously. Which is a good thing, since someone has to buy the output of an
economy that is growing at least ten times faster than today's mature
postindustrial economies (which average an annual growth rate of between 2%
and 4%). If economies suddenly were to grow by 20% to 40% annually while
individual consumers saw their incomes **dropping** there would be large
potential for social unrest. Of course, if prices for most essential goods
and services (food, clothing, medical care, education, etc.) were to drop as
fast as or faster than wages did, the situation would not be dire. However,
if the super-high-tech economy were also producing relatively expensive
luxury goods (like "gotta have" electronics) that lay far beyond the price
range affordable to most wage earners, there could still be a social
stratification that might undermine social peace.

I think we should be concerned about this. If we want to ensure a social
environment in which FAI and transhumanist goals can be achieved, then we
need to take care to avoid extreme concentrations of wealth and poverty. In
general, if we have a kind of Pareto's Law (so-called) distribution in which
20% of the population controls 80% of the wealth, we should be OK since that
seems to be the natural ratio (an approximate ratio that appears in many
systems, by the way, including internet web links). But if we get into more
extreme differentials, such as 5% and 95%, then either repression or
revolution become practically inevitable and the chance to build the kind of
future we want to see will slip away for a long-possibly very long-time.


Michael LaTorra

"For any man to abdicate an interest in science is to walk with open eyes
towards slavery."
-- Jacob Bronowski

Extropy Institute:
World Transhumanist Association:
Alcor Life Extension Foundation:
Society for Technical Communication:

> -----Original Message-----
> From: []On Behalf Of Michael
> Anissimov
> Sent: Wednesday, May 12, 2004 8:27 AM
> To:
> Subject: Economic Growth Given Machine Intelligence
> "Economic Growth Given Machine Intelligence" by Robin Hanson:
> --
> Michael Anissimov
> Advocacy Director, Singularity Institute for Artificial Intelligence
> --
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