Quote:
Originally Posted by Suit
If humans don't have jobs, they don't have money and can't buy anything that robots built, so effectively using robots to do all jobs will put companies out of business.
Humans will still successfully compete with robots for jobs. The infinite stream of payments paid to a human to do a job still has a finite
present value. If that present value is less than the cost of automating the job, using human labor is more cost effective. The cost of automating includes the development costs, equipment costs, and the present value of future maintenance and energy costs. Additionally, human labor is more versatile than automated systems, and will be for a long time. Humans can be more easily switched from one type of job to another, as needed.
There is also the concept of
comparative advantage:
Quote:
David Ricardo developed the classical theory of comparative advantage in 1817 to explain why countries engage in international trade even when one country's workers are more efficient at producing every single good than workers in other countries. He demonstrated that if two countries capable of producing two commodities engage in the free market, then each country will increase its overall consumption by exporting the good for which it has a comparative advantage while importing the other good, provided that there exist differences in labor productivity between both countries. Widely regarded as one of the most powerful yet counter-intuitive insights in economics, Ricardo's theory implies that comparative advantage rather than absolute advantage is responsible for much of international trade.
This concept can be applied, instead of to different countries, to humans and robots. If robots get to the point where they are better than humans at everything, it still makes sense to use the robots only on the tasks they are best at, and allow humans to do other tasks for which the robots do not have as large an advantage over us.
As technology increases production, and as automation disconnects the productivity of the economy from the number of people working, the cost of consumer goods will go down, and humans can afford to buy just as many goods and services as they do now, with much less money and much less labor.
