Artificial general intelligence may make UBI adoption a must

Nonetheless, economic growth has been slowing down in recent decades. A major reason for this has been an economic slowdown across much of the rich Western world due to reasons like a slowdown in population growth as well as a lot of manufacturing industry moving to other parts.

In the years to come, this trend is expected to reverse due to the spread of artificial general intelligence (AGI) technologies. So, as AGI spreads, the global economy is expected to grow at a much faster pace. Indeed, the world already can’t talk enough about ChatGPT and Bard, both early examples of AGI.

So, what exactly is AGI? William Macaskill defines AGI in What We Owe the Future, as “a single system, or collection of systems working together, that is capable of learning as wide an array of tasks as human beings can and performing them to at least the same level as human beings." In that sense, the spread of AGI will lead to creation of artificial agents capable of “forming plans and executing on them in just the way that human beings can."

Now how will this drive economic growth? At a simple level, this new technology, like all new technologies that perform work, is expected to drive up productivity (that is more output per input) at a faster pace.

Investment bank Goldman Sachs expects AGI to “lift productivity growth by 1.5 percentage points over a 10-year period." As Joseph Briggs and Devesh Kodnani, economists at Goldman Sachs write: “[AGI]’s… ability to generate content that is indistinguishable from human-created output… reflects a major advancement with potentially large macroeconomic effects."

Macaskill, on the other hand, believes that a country could grow the size of its economy indefinitely by using AGI to produce more artificial agents who could work in the same way as humans. This will drive up productivity and in the process lead to faster economic growth.

Goldman Sachs expects that AGI could drive a 7% (or almost $7 trillion) increase in global gross domestic product (GDP) over a 10-year period. In 2022, the global GDP was slightly less than $100 trillion.

Meanwhile, Macaskill, who has taken a much longer-term view than Goldman Sachs, predicts runaway economic growth due to the spread of AGI. As he writes: “Given that the global growth rates have increased thirtyfold since the agricultural era, it’s not crazy to think that they might increase tenfold again; but if they did, the world economy would double every two and a half years."

Before the covid pandemic broke out, the world economy was growing at around 3% per year, implying that it doubled in size every 24 years. For it to double in two-and-a-half years, it needs to grow at 32% per year. In a 2021 report, Tom Davidson of Open Philanthropy had said that explosive growth of more than 30% per year was possible during the course of this century.

Like is the case before the spread of any new technology, currently, all kinds of varying forecasts are being made. The history of technological spread tells us that it is very difficult to forecast which way any technology will go and the economic and social impact it will eventually have. Nonetheless, one can always indulge in some speculative thinking.

Indeed, what is clear here is that the success of AGI technologies will be directly proportional to the automation of jobs. Economists at Goldman Sachs believe that “shifts in workflows triggered by these advances could expose the equivalent of 300 million full-time jobs to automation."

This would create its own set of challenges. One, if AGI leads to massive job losses, things could turn political very soon. Second, the benefit of economic growth due to AGI will be highly concentrated among firms that come up with successful AGI technologies, their founders and employees. Third, in the past, while technology has destroyed jobs, it has also created new ones. This time, given that the job losses are likely to be more white-collar than blue-collar, the chances of that happening are significantly lower.

This will have its own impact. As Bill Bonner writes in Hormegeddon: How Too Much of a Good Thing Leads to Disaster: “products are paid for with products," not merely with money… “you [need] to produce things to buy things." If people lose jobs due to AGI technologies, their ability to buy stuff which others are producing will go down. This will have an impact on employees and employment at other firms, increasing the unequal distribution of fast economic growth even further.

If things play out like this, politicians are likely to get involved sooner rather than later. They can slow down the development and spread of AGIs. At the same time, they can allow these technologies to spread and then compensate the population at large through a universal basic income (UBI). Of course, a UBI will have to be funded through high taxes on firms and individuals who gain the most from wide adoption of AGI for tasks. One doesn’t know for sure how this will eventually play out, but the spread of UBI is one possible outcome.

Vivek Kaul is the author of ‘Bad Money’.