From: Robin Hanson (rhanson@gmu.edu)
Date: Fri Jul 25 2003 - 14:59:44 MDT
On 7/24/2003, Rafal Smigrodzki wrote:
> >> You might want to apply Ricardo's Law of Comparative Advantage,
> >> and also briefly think about the price of robots in relation to the
> >> average income of the unemployed. If you add these two simple
> >> considerations, you could conclude that there is no need to "deal"
> >> with any situation here, ...
> >
> > Precisely how do you envision those without jobs making it in such a
> > scenario?
>
>They go to the store, buy a robot, and ask it to work on their behalf.
>In other words, they invest their capital, instead of their labor. ...
>Where they get the capital to invest is a different issue altogether.
Since this transition is expected to happen many decades into the future,
and since a dollar invested now should give many dollars then, an obvious
solution is for people to save now in anticipation of the day when their
labor will be worth much less. And to the extent that this transition
date is uncertain, people might do even better by financial risk hedging
that in essence insures people against uncertainty in this transition date.
I talked about this in my uploads paper (http://hanson.gmu.edu/uploads.html)
and Robert Shiller talks about it on pp. 48-50 of his popular book
"The New Financial Order", where he advocates creating many new markets
to help people hedge risks such as this.
Robin Hanson rhanson@gmu.edu http://hanson.gmu.edu
Assistant Professor of Economics, George Mason University
MSN 1D3, Carow Hall, Fairfax VA 22030-4444
703-993-2326 FAX: 703-993-2323
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