Thank you! Appreciate the feedback :)

I sort of see where both criticisms are coming from. The lowest-common-denominator, community-related posts get the highest engagement (including from people like the OP) because they require little context. The high context technical stuff is much harder to parse, and necessarily has a smaller audience, so gets less engagement (perhaps with the exception for AI Safety, which is currently experiencing a "boom"). 

There will naturally be fewer technical posts in the areas I'm interested in and, like Michael_PJ, I have no desire to read long technical posts in areas I'm not interested in, so I end up engaging disproportionately with community-related posts. 

Fiddling with the forum filters helps - I personally have downweighted posts tagged "Community" and "Building effective altruism" - but I suspect few people do this.

Hi Dushan. I cover this at a high level under "But impacts will be uneven" heading. I agree with you that countries in the supply chain will benefit and others less so.

Thank you! Yes, totally fair point. I am not trained in development economics so was very uncertain about this post, and expected there to be large differences between countries that I wouldn't pick up. It's disappointing to hear that the development econ mainstream has not been engaging with this topic.  

I had in mind the lower-income countries (mostly in Africa) when writing most of this. Your point about how, without TAI, these countries might be able to develop export industries and climb the development ladder is an interesting one. I had thought of that briefly, but was unsure how likely that was to happen, given we haven't seen any African country do it yet (to my knowledge). But perhaps it's just something that takes time and can only really happen after the middle-income countries become rich. 

AI agrees with you on cars and yachts, but says the majority of TVs, gaming rigs, and bikes consumed in HICs are made in LMICs. 

Fair enough. I think most of these are made in Asia and I do expect Asia (particularly China) to fare better than most other LMICs or developing countries. 

I should note that "transfers" is not limited to unemployment benefits. For OECD governments, the biggest class of transfer by far is currently public pensions. 

There are all sorts of good reasons why the elderly should be happy with lower public pensions (elderly poverty rates tend to be lower than for children or working-age adults, life expectancy has increased far more than retirement ages have). But that still doesn't happen for political economy reasons. Perhaps that will change with TAI - the elderly tend to own more capital so they should see massive returns in general. Maybe they'll be happy with <10x pension increases even as wages increase 10x. I just wouldn't take that for granted.

Agree 100% that governments would need to tap into capital gains somehow, or capital more broadly. I also like that Capital dividend fund idea - thanks for sharing. 

Thanks for the post! I share much of the concerns you raise, particularly your conclusion that benefits of AI will not be distributed equitably through natural market mechanisms. 

There will still exist a sizable gap between the development of these systems and their diffusion into the broader economy, but this gap will be on the order of years, not decades. 

I am curious about why you think this. And by "the broader economy" are you talking about the global economy or only the US? I don't have any firm views on speed of diffusion but I find decades plausible, at least when it comes to the global economy. Especially if diffusion involves widespread deployment of robotics. 

Thanks. I'm a bit sceptical of that 10x estimate and will have a closer look at that paper.

However, even assuming wages for non-automatable roles goes up ~10x before full automation, that won't help governments if their costs rise more than 10x. In developed countries, government costs mostly consist of social protection transfers and wages themselves. In the case where wages rise 10x, transfers could rise more than 10x if (1) transfers are linked to wages (which they often are); and/or (2) the share of people receiving transfers rises (because unemployment rises). 

It is possible that transfers could be de-linked from wages somewhat, but political economy can make that difficult and, to the extent that people's welfare depends on the parts of the economy that are not rapidly growing (e.g. healthcare, housing, childcare), that could have negative welfare impacts. 

So I'm not saying governments are doomed - as I point out, TAI should be creating value and the challenge is ultimately one of distribution. But governments still have to worry about revenue, because it's not the size of GDP that matters so much as the composition of government income and spending. 

Thanks for the feedback and you raise some interesting points.

the demand for manual labor will increase dramatically, because the people making a lot of money from AI will want bigger houses, more roads, and more physical goods in general

I'm not sure about this. I think we have different intuitions on how broad the class of "people making a lot of money from AI" vs how broad the class of knowledge workers losing out from TAI. My sense is that the former will be smaller than the latter, just based on data I've seen showing how little most people in developed countries have saved for retirement in the form of financial assets like shares (i.e. I haven't researched this, and it likely depends on the country).

I guess this will also depend on the specific capabilities of TAI and how much labour it will displace. 

I appreciate this challenge and it would be good to see some modelling on it (I might have a quick go at some stage). 

Some of the production of goods will be done in the HICs (perhaps increasing remittances), but I think a lot will be done in LMICs, which would a boon for those countries.

Interesting point. Some of the goods you mention people getting rich from AI will want are bigger houses and roads. These are not globally traded so, to the extent TAI increases demand for construction work, I would expect this demand to increase in HICs rather than LMICs.

To the extent that people getting rich from AI want to increase their consumption, I expect much of that will be channelled through higher demand for in-person services - e.g. personal chef, gardener, masseusse, and (as you point out) construction. 

Some increased consumption might also be channeled through physical goods, but physical goods are already incredibly cheap relative to incomes in HICs. The main bottlenecks to consumption are likely to be physical space (your house needs to be big enough for your toys) and leisure time. I expect TAI could remove the leisure time bottleneck for existing capitalholders, which could boost demand for leisure complements. But there is still only so much time in the day, and many higher-tech leisure goods like TVs, gaming rigs, bikes, cars, yachts don't rely much on LMIC labour anyway. (Some things like clothing and tents may be more exceptions.)

I do agree with you that some LMICs could see a boon - but I don't expect this effect to be widespread across LMICs in general. 

Also, in this scenario, government revenue would be large because they would be taxing the high wages of manual workers, and taxing massive corporate/capital gains.

I disagree with this because most governments tax labour more heavily than capital. So if all the income currently earned by labour just shifts to capital, all else equal tax revenues will decline. (At the same time government spending will likely have to increase to pay for increased unemployment. I go into this more here.)

If governments are able to shift their tax bases towards capital we might see tax revenues remain stable.^[1] But there are major challenges to taxing capital: capital is mobile and more easily hidden, there are serious valuation issues when you try to tax unrealised gains^[2], and it is distortionary because it is very hard to properly account for inflation. Plus there are a bunch of political challenges. All these challenges are why tax bases rely more heavily on labour to begin with. 

1. ^{^}

   I find it highly unlikely tax revenues would increase in the near term. 

2. ^{^}

   Most countries tax realised gains instead, but this leads to undertaxation because taxpayers can choose when to realise those gains, which is usually only when they need to fund personal consumption. There are also tax avoidance opportunities and distortionary lock-in effects that crop up when taxpayers can choose when to realise their gains - which is part of why capital is almost always taxed at flat rates rather than on a progressive schedule.