I read Martin Ford’s Rise of the Robot because it presents the capacity of robots and machine learning algorithms and the social and economic impacts of substituting human labour with those technologies. The book also introduces a policy-oriented solution to the looming threat of large-scale unemployment if such a transition is realized.
As an intermediate step towards Artificial General Intelligence (AGI), advances in robotic technology and machine learning software, which can be also categorized as “narrow AI”, is going to pose a greater threat towards our near-term economic development – robots are likely going to further automate factory production and eliminate the need for routine and repetitive job in many industries including electronic manufactory and textile industries. Full automation is going to reduce labour cost and improve efficiency in such industries.
With no need for manual labour in factories, many workers with low education will find themselves unable to locate a new job since service industry is also going to be automated soon afterwards. Gourmet robots and more intelligent self-service robots have great potential in revolutionizing fast food and retail industries. Ford claims that once the cost of purchasing such robots falls below the cost of labour, companies will be motivated to transition to robotic technology. However, the rate in which companies adopt robotic technology in the service industry is more likely to be gradual. In order to implement such technology, companies also need to make changes to their basic business models, undergoes major innovation for brick and mortar stores, and reorganizes kitchen space and internal logistics for fast food industries.
Furthermore, some white collar jobs will be replaced by machine learning algorithms. Machine learning algorithm will thrive at routine and repetitive white collar job, and are likely going to yield more value than human workers. As we have seemed in many examples of machine learning software, self-driving car is undoubtedly safer than human-operated car and Jeopardy! winning Watson is better at organizing information than any other human contestants.
Ford concludes that this unprecedented automation movement will have a grave impact on our economy. Many people will become permanently unemployed as they are unlikely going to find an alternative job even with vocational training. Those who don’t have a job will decrease their consumption level and those who still do will follow the case as they foresee a jobless future. Consumption will decrease rapidly, and the downward spiral of price decrease is going to start a deflation cycle. Eventually, the society will end up with a techno-feudal scenario where top 5% will be able to live prosperously and the bottom 95% have zero income, no ownership of capital, and no means of sustaining lives.
I would argue that such scenario is unlikely going to play out in the near-term future, since we can safely assume that the narrow AI machine intelligence wouldn’t have a comparative advantage over human in jobs that require creativity. As we can see in the case of AlphaGo, even after computer simulates thousands of random games of self-play, the computer is still surprised by an unexpected move by a human player. Such observation can be implied to real-life situations, where brute force calculation of possible outcomes will ultimately lead to a combinational explosion.
Let’s consider the case of online video sharing, an entirely new industry that currently enjoys rapid growth as advertisers find that younger audiences are abandoning cable television and spend more time online. Although YouTube’s content creators earn most in this industry, some new video sharing platforms including Vine and Snapchat managed to expand the market and create new opportunities for content creators. Additionally, the top earner for each platform rarely overlaps, albeit many top earners have multiple accounts across different platforms.
Ford might oppose to this idea by suggesting that the market has a long tail distribution where 80% of total income are earned by 20% of creators and that there are limited opportunities in this market. I would argue that the potential of the internet is not yet fully realized in many countries, and more categories and form factors are going to be created as the market expand. Likewise, other online platforms are going to follow a similar trend. Newly created successful platforms will be able to generate a sizable labour demand that acts as a buffer zone for the unemployed and recently graduated.
There is also another labour market that will see moderate growth alongside the automation process. As we customize robotic technologies for each candidate industry, the demand for software and hardware engineer are going to rise respectively. These jobs are essential for creating industrial solutions for companies that want to automate their production process and digitize their workforce. Development of vocational training and K-12 education of computer science is critical for the economy.
Nevertheless, we also need to build a safety net for the worst case scenario. Ford claims that the guaranteed basic income approach proposed by Friedrich Hayek is sufficient in solving the polarizing income inequality problem. The guaranteed income does have some downfalls in that it encourages free riders to cheat the system and permanently exit job market. Furthermore, since cities have vastly different standard of livings, it is very hard for a federal or state government to implement a guaranteed income standard that will satisfy everyone’s need. The guaranteed income approach is also likely going to face strong political opposition in both parties in that the policy will fundamentally transform the role government play in the economy.
There are some valuable takeaways from this book that inspires me to focus my research on the future of professions and viable economic and political strategies.
First, the job market in near-term future is likely going to change rapidly, and it will be a life changing traumatic experience for those who have a routine and repetitive job to be excluded from the workforce. We need to find new ways of employing those who lose their jobs but are unwilling to stay unemployed.
Second, very few economists and political scientists are engaged in the conversation of how we should react to the potential threat of spreading structural unemployment. As we fully automate industries and subsequently make human labour obsolete, we need to find more viable economic and political strategy to ensure the transition to jobless society as smooth as possible.
The book Rise of the Robot is an interesting read as it delves deep into the world of robots. It extensively explores implications of robotic technologies that are previously unthinkable. The book also provides a viable policy that can potentially solve the polarized income inequality problem. The book is a good read for everyone since it is a problem that is faced by the entire human race, and the increasing attention towards this problem is going to help solve this very urgent problem.
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Ford, Martin R. “Technologies and Industries of the Future.” Rise of the Robots: Technology and the Threat of a Jobless Future. New York: Basic, 2015. N. pag. Print.
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