Journal
ECONOMICS OF INNOVATION AND NEW TECHNOLOGY
Volume 29, Issue 5, Pages 540-558Publisher
ROUTLEDGE JOURNALS, TAYLOR & FRANCIS LTD
DOI: 10.1080/10438599.2019.1643557
Keywords
Perpetual economic growth; economic effects of robots; labor share in income; income distribution
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The recent literature on the economic effects of machine learning, robotization and artificial intelligence suggests that there may be an upcoming wave of substitution of human labor by machines. We argue that these new technologies may lead to so-called perpetual growth, i.e. growth of per capita income with a non-progressing state of technology. We specify an exact parameter threshold beyond which perpetual growth emerges, and argue that ongoing technological change may bring the threshold in reach. We also show that in a state of perpetual growth, factor-eliminating technological progress reduces the role of labor in the production process and that this leads to a rising wage rate but ever-declining share of wage income. We present simulation experiments on several policy options to combat this inequality, including a universal basic income as well as an option in which workers become owners of 'robots'.
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