Billy Brown, <firstname.lastname@example.org>, writes:
> In that situation I would say that sentient labor is the major expense for
> the economy as a whole, and that reducing the labor content of a product is
> the key to reducing its production cost. Scarcity premiums, monetary
> distortions, and other such issues are transitory in nature, and in a
> healthy economy they will be minor factors in any event. Profit is more
> enduring, but it usually represents a major cost issue only in very risky or
> very uncompetitive markets, and both of these conditions tend to be
> transitory in a society with rapid technological progress.
Your term "sentient labor" is a bit unclear with regard to machines. What would you predict would happen to costs as more labor is taken on by machines? Would it matter if the machines are as smart as people, or even smarter?
It would seem on the one hand that you could just treat them like any other tool, like a shovel. Count how long the tool lasts and what its own production costs are (including labor to design it, etc.). Include maintenance costs for the tool as well. In the case of an AI, maintenance costs might include time spent periodically refurbishing and reorganizing the software state, elaborate versions of today's garbage collection systems. This might require the AI to, say, spend time interacting with a high-information-quality environment, or to be dormant while the software refreshes itself for another work period.
Or you can treat the AI like a person, and figure that its efforts count as labor. The wage it can earn will depend on how common such labor is, which will in turn depend on the production costs for the AI. Instead of maintenance costs, we say that the AI wants to spend time engaging in recreation or sleep, and will seek a wage adequate for these outside activities.
These seem to be two different ways of looking at the same situation, but they apply the cost analysis in a completely different way. Is it really meaningful to say that all costs are due to labor, if it is ambiguous what counts as labor?
Many people have argued that as machines take over more tasks, everything
will become cheaper because less labor is involved. Lyle in his pages
argues that machines are, in effect, labor. The mere fact of substituting
a machine for a human being does not inherently make products cheaper
because the machine has expenses just as people do.
Now, I think the flaw in Lyle's reasoning is that machines are designed
to have lower expenses and be more productive than people. But he is
right in that the economic gain is not due directly to the subtitution
of a machine for a person, which an overly simplistic analysis based
on costs-as-labor might suggest. Rather, it is only when machines are
economically able to do the same work for less money that we have a
Now, I think the flaw in Lyle's reasoning is that machines are designed to have lower expenses and be more productive than people. But he is right in that the economic gain is not due directly to the subtitution of a machine for a person, which an overly simplistic analysis based on costs-as-labor might suggest. Rather, it is only when machines are economically able to do the same work for less money that we have a true savings.
Economic production is traditionally analyzed based on inputs of labor, raw materials, and capital. Perhaps in the future the distinction between labor and capital will become blurry in the case of robots. At that time we might see that people, too, are in a sense another form of capital. The sharp and historically contentious distinction between labor and capital may come to be seen as an illusion.