I finished reading it yesterday, so I wanted to do a little recap. The book is quite short; it’s really more of a quite readable long-form article, truth be told. But it’s one of the better pieces I’ve read yet (although there’s still a lot more I’d like to read) on what I think is a really important topic.
Erik Brynjolfsson and Andrew McAfee (B&M) start by outlining their argument. The first part is that the rate of technological growth is accelerating, and that over time there are likely to be fewer and fewer areas where humans can realistically compete – as economic inputs – with machines. No argument from me there; I think that’s both plausible and correct.
In the next chapter they outline three dichotomies that arise as a result of accelerating technological growth:
- High skilled vs. low skilled workers: this one isn’t ground-breaking, but it’s important. Low-skilled workers are suddenly displaced by technology; but high skilled workers may find there are more opportunities.
- Superstars vs. everyone else: B&M had some helpful comments on why this becomes more important with technology. As technology flattens out some markets, all of a sudden one person can dominate the market:
Technology can convert an ordinary market into one that is characterized by superstars. Before the era of recorded music, the very best singer might have filled a large concert hall but at most would only be able to reach thousands of listeners over the course of a year … Once music could be recorded and distributed at a very low marginal cost, however, a small number of top performers could capture the majority of revenues in every market, from classical music’s Yo-Yo Ma to pop’s Lady Gaga.
- Capital vs. labour: This one is really obvious, but really important. As human labour becomes less important, it captures a smaller share of national income compared to labour.
In the next chapter, they talk about what we can do to deal with the change. This section I found disappointing. There are some mildly useful ideas; things along the lines of better investment in education and more appropriate organisational structures. They also suggest a set of policy ideas that struck me as straight out of the grab-bag of ‘economists’ ideas for how the economy should be different’; they’re not terribly revolutionary or important.
More than the ideas they did suggest though, it was what they didn’t suggest that was much more important. I think technological growth has huge implications, and we should be thinking about some of them right now – but I’ll talk about that in a moment.
Their final chapter is largely a statement – not well-supported by argument, I thought – that technological growth is good for society. That’s a statement so general it’s hard to pin-down meaningfully, let alone disagree with.
I think B&M identify the right issues; technological change is accelerating, and has really important implications for our labour markets, our society, and how we think about a whole lot of things. But their analysis of ideas and solutions felt like a set of intellectual band-aids; marginal ideas that weren’t really relevant to the questions they were examining.
I have vague thoughts on some of the issues that really matter in this space; one is population growth, which really matters. Another is how we think about capital – as it becomes more important, and as labour becomes less and less important as an input, how will our society change?
There are other questions that are important too, I’m sure, I just haven’t thought of them yet.