AI/SI economics (was Extro list - Re: DiscoveryCh - AI)

From: Michael LaTorra (
Date: Sat Jan 27 2001 - 22:09:27 MST

Anders Sandberg wrote:

>isn't just about monetary relationships, but also about general
>interactions involving utility (didn't Ludwig von Mieses suggest a
>fancy Greek word meaning "getting enemies to work together" or
>somthing similar rather than the zerosumish 'economics' as the name
>for the field? A friend mentioned it today, but the exact term slipped
>my mind).
>When discussing AIs/SIs the economic ideas employed are often very
>primitive. Often the issue is simply ignored or a kind of zero level
>economy of getting what is needed through superior force or just
>picking it up is assumed. This is generally linked with the idea of a
>spiking SI, so that there is really a single agent with near total
>autonomy. A more nuanced look at AI/SI economics would take into
>account what has been learned in game theory and economics, the
>economic context these entities come into existence inside and then
>co-evolve with, the higher-order interactions that would emerge
>between different kinds of agents and so on. ....

'Gald you brought this up, Anders. I'm not an economist, but I've taken
enough economics courses in college and read enough econ books (my fav being
Freidman's _The Machinery of Freedom_) to suspect that even an SI will
employ some form of economic analysis (e.g., costs vs. benefits). If there
are multiple SI agents, then some kind of exchange system will almost
certainly develop (either as a market or as conflict). The interaction of
(unaugmented) humans with SIs will also likely follow a game theoretic form,
I think (try to find a copy of the out-of-print classic _Superior Beings_ by
Brams for a deep analysis of this interactions).

Ludwig von Mises, perhaps the greatest philosopher of free market economics,
did not anticipate the technological Singularity. However, in his book
_Human Action_ he did include a section about the singular nature of
economics, where he cautions about the lack of proofs in economics (which
should serve to keep us from arguing about the claims on either side of the
issues raised above for more than, say, two or three months.;) I thought it
would be appropriate to quote it here (from:

1. The Singularity of Economics

"What assigns economics its peculiar and unique position in the orbit both
of pure knowledge and of the practical utilization of knowledge is the fact
that its particular theorems are not open to any verification or
falsification on the ground of experience. Of course, a measure suggested by
sound economic reasoning results in producing the effects aimed at, and a
measure suggested by faulty economic reasoning fails to produce the ends
sought. But such experience is always still historical experience, i.e., the
experience of complex phenomena. It can never, as has been pointed out,
prove or disprove any particular theorem.[1] The application of spurious
economic theorems results in undesired consequences. But these effects never
have that undisputable power of conviction which the experimental facts in
the field of the natural sciences provide. The ultimate yardstick of an
economic theorem's correctness or incorrectness is solely reason unaided by
The ominous import of this state of affairs is that it prevents the naive
mind from recognizing the reality of the things economics deals with. "Real"
is, in the eyes of man, all that he cannot alter and to whose existence he
must adjust his actions if he wants to attain his ends. The cognizance of
reality is a sad experience. It teaches the limits on the satisfaction of
one's wishes. Only reluctantly does man resign himself to the insight that
there are things, viz., the whole complex of all causal relations between
events, which wishful thinking cannot alter. Yet sense experience speaks an
easily perceptible language. There is no use arguing about experiments. The
reality of experimentally established facts cannot be contested.
But in the field of praxeological knowledge neither success nor failure
speaks a distinct language audible to everybody. The experience derived
exclusively from complex phenomena does not bar escape into interpretations
based on wishful thinking. The naive man's propensity to ascribe omnipotence
to his thoughts, however confused [p. 863] and contradictory, is never
manifestly and unambiguously falsified by experience. The economist can
never refute the economic cranks and quacks in the way in which the doctor
refutes the medicine man and the charlatan. History speaks only to those
people who know how to interpret it on the ground of correct theories."


Michael LaTorra
Extropy Institute:
Alcor Life Extension Foundation:
Society for Technical Communication:

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