Robots Are Not Your Economic Enemy

In this era of rapid technological progress, many of us cannot help but wonder what the future holds. In particular, improvements in automation have sparked a conversation on the impact that robots will have on the demand for labor. Some projections are rather dystopian, suggesting that a large part of humanity will be rendered permanently jobless as workers are replaced by robots. 

Robots can never reduce the number of jobs available overall.

In December, physicist Stephen Hawking cautioned, “The automation of factories has already decimated jobs in traditional manufacturing, and the rise of artificial intelligence is likely to extend this job destruction deep into the middle classes, with only the most caring, creative or supervisory roles remaining.”

In February, Tesla CEO Elon Musk warned, “What to do about mass unemployment? This is going to be a massive social challenge. There will be fewer and fewer jobs that a robot cannot do better.”

Only two days later, Bill Gates proposed taxing robots in part to “slow down the speed” of automation.  

While capital does indeed render some jobs obsolete and displaces labor in the short run in a process of “creative destruction,” robots can never reduce the number of jobs available overall; this realization follows from the unlimited wants that drive human action in this world of limited resources.  

Workers are replaced by machines when it is efficient to do so.

Automation is Liberation 

Consider that at one time there were no professional actors, musicians, artists, or writers. This is not to say that our distant ancestors would not have enjoyed such entertainment, but given the crude state of technology at the time, even those with artistic talent had to allocate their time to more pressing concerns like plowing fields. To instead produce paintings full time carried too high an opportunity cost in terms of lost food output.  

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