The Robots Have Descended on Trump Country

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I asked Acemoglu whether these findings challenge the economic argument that technological advance is almost always beneficial. He replied:It does challenge the conventional wisdom to some degree. But this conventional wisdom is really up for challenge. The view that technological change always and everywhere benefits most groups is completely devoid of historical context. This isn’t what has happened in history, this isn’t what has happened in the early 20th century.He cited key developments in the late 1890s and early 1990s:During mechanization of agriculture, we have also experienced rapid creation of new jobs and tasks in industry, both for production workers and for clerical workers. If it weren’t for these other changes, many of them technological and social in nature, mechanization of agriculture would have created much more hardship (and today we tend to forget how much hardship it did create in the first place).Acemoglu, Restrepo and Autor are not alone in exploring the economic and political consequences of robotics and artificial intelligence.Jeffrey Sachs, a professor of economics at Columbia, has a parallel take, writing by email:Until now, automation (robotics, machines more generally, smart systems) has mostly replaced activities that require brawn (agriculture, mining, lifting, warehousing) repetitive physical activity (assembly line, cutting/sowing), basic data management (ledgers, various logistics), while being complementary with complex management, human judgment, highly contextual activities.The demographic group most hindered by the rise of automation, Sachs wrote, “has been the proverbial white male with less than a college degree and living in rural and semirural areas.”Sachs believes thatthe next wave of job losses will be in basic business services (wholesale and retail trade, warehousing and transport) which will mean another hit for workers with relatively lower educational attainment.In terms of incomes, according to Sachs, “automation (including AI) will raise overall output but lower the earnings of some or even all workers, while raising the returns to many forms of capital.”Without the adoption of redistributive tax and spending policies, he argued,the old, the skilled, and the rich (who will make intergenerational transfers within families to their own children) will benefit at the expense of the young, the less skilled, and the poor. All of this seems to be underway.Jason Furman, a professor of economics at Harvard’s Kennedy School who served as chairman of the Council of Economic Advisers in the Obama administration, writing with Robert Seamans, a professor of management at N.Y.U., has a broader view of the positive and negative effects of automation and artificial intelligence.In their June 2018 paper, “A.I. and the Economy,” Furman and Seamans argue that, from a theoretical perspective, innovation has four effects on labor markets.The first is that “automation can directly displace labor in the affected sector.” Second is that “automation can create new jobs in new areas.” The authors note that “job losses at brick-and mortar department stores were more than made up for by new opportunities at fulfillment and call centers.” The third effect is that “higher incomes increase demand for jobs throughout the economy, including in ways that are not directly linked to technology. For example, the share of workers in leisure and hospitality in the United States has steadily trended upward as household incomes have risen, enabling people to afford more restaurants and travel.” And the fourth effect is that “technology may replace specific tasks rather than entire jobs — leaving substantial room for human employment in jobs that will be changed by worker’s having a new tool at their disposal.”