Evolving technologies like robots, artificial intelligence, and machine learning are moving into our societies at a rapid pace and the impact to human jobs has not been properly assess by policy makers. But what happens If robots take all the jobs not just those jobs in international trade?
Technology can improve the speed, quality, and cost of available goods and services, but it can also displace large numbers of workers. This possibility begs the questions of who will buy the products made by robots or the services provided by machines? Moreover, how are traditional benefits like health care and retirement accounts will be provided to the working class? In such an economy that employs dramatically fewer workers, we’ll still need to deliver benefits to displaced workers. Furthermore, our traditional methods of taxation and microeconomics behavior will be not longer be valid and a new model must be in place to accommodate the machine age and its lasting effects on humans.
The impact of machines ran by computers is already being felt throughout the economy. The worldwide number of industrial robots has increased rapidly over the past few years. The availability of lower priced robots, which can operate all day without interruption, makes them more profitable than human workers. Computer can execute stock trades in a fraction of a second, faster and more accurately than any human.
Any policy measures that encloses the future of employees must also include the effects of uncertainty and the outcomes expected on future employment. The United Nations estimates that global poverty has been reduced more in the past 50 years than in the previous 500 and China is point on the count.
Many claim that software automation that has eliminated jobs is also creating more jobs than it has destroyed. The U.S. census data released in September indicates that the largest annual drop in poverty since 1999 and adding that 3 million jobs were created from 2014 to 2015. Moreover, the world’s top tech companies are in a race to build the most advanced AI and dominate a massive market however, this also becomes part of scary story which means the technology will get better fast and contending with slow moving policy that must be in place to adjust for the change. The last time our societies went through such radical experience came about in the last century when the automobile, telecommunications, the airplane and mass electrification were introduced changing the world. “A society that had established countless routines and habits, norms and regulations, to fit the conditions of the previous revolution, does not find it easy to assimilate the new one,” according to economist Carlota Perez in Technological Revolutions and Financial Capital, her classic book.
Big questions facing policy makers is how to solve the unemployment of displaced workers and how to fund and design the retraining of the workforce. How are income taxes going to be collected from the massively unemployed workforce? And who is going to purchase industrial production when people lack incomes?
It seems that the transition from a labor economy to one run by AI and robots will need to come in a package deal which would need to include a safety net for displaced workers and a retraining component for the new economy. Even so, the question of where the funds are going to come from for such massive investments and expenditures that will be needed to counter act the rapid pace of change is still up in the air? Many have suggested taxing robots and automation in order to raise the funds required for the transition to the new era.
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