What Gordon then does is suggest that IR #3 has already mostly run its course, that all our mobile devices and all that are new and fun but not that fundamental. It’s good to have someone questioning the tech euphoria; but I’ve been looking into technology issues a lot lately, and I’m pretty sure he’s wrong, that the IT revolution has only begun to have its impact.
Consider for a moment a sort of fantasy technology scenario, in which we could produce intelligent robots able to do everything a person can do. Clearly, such a technology would remove all limits on per capita GDP, as long as you don’t count robots among the capitas. All you need to do is keep raising the ratio of robots to humans, and you get whatever GDP you want.
Paul Krugman
Uhm, actually no! Robots would only provide ‘unlimited’ labor, but you would still need raw materials and abundant energy to produce goods – and the robots! Unless we manage to recycle basically everything – some rare metals used in electronics are really hard to come by – and switch to cheap, renewable energy sources, going full-robot-labor wouldn’t remove growth limits on GDP. You would think a Nobel Prize winner would know such basic things…
Ah, you ask, but what about the people? Very good question. Smart machines may make higher GDP possible, but also reduce the demand for people – including smart people. So we could be looking at a society that grows ever richer, but in which all the gains in wealth accrue to whoever owns the robots.
This bit sounds eerily realistic though…
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