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The Robot Question

Phelps, Edmund S.

The COVID-19 pandemic is hastening the spread of artificial intelligence (AI), but few have fully considered the short- and long-run consequences. German Chancellor Angela Merkel has been laboring under enormous pressure to prevent a veto of the European Union's 2021-27 budget and COVID-19 recovery fund. But the compromise she reached with Hungary and Poland is the worst of all possible worlds. In thinking about AI, it is natural to start from the perspective of welfare economics – productivity and distribution. Consider a model of a national economy in which labor performed by robots matches that performed by humans. To complete the model in the simplest way, suppose the economy has just one sector, and that aggregate output is produced by capital and total labor, human and robotic. This output provides for the country’s consumption, with the rest going toward investment, thus increasing the capital stock.

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More About This Work

Academic Units
Center on Capitalism and Society
Economics
Series
Center on Capitalism and Society Working Papers, 120
Published Here
January 12, 2022

Notes

Originally published as an Op-Ed in Project Syndicate on August 6, 2020.