Automation Nation

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As colleges pump more and more graduates into the workspace and automation starting to catch on in companies, we ask ourselves – is AI the future? Nobel Prize winner, Abhijit Banerjee & Esther Duflo investigate if this is possible.

  1. Replacement of human labour by robotic efficiency is a fear shared by both economists and those who comment on economics. 

MIT economists, Erik Brynjolfsson and Andrew Mcfee outline a bleak view of the future where workers with ‘ordinary skills’ may not have a place in industry. 

2. We’ve seen this before

The first IT revolution is a sad but truthful indicator of what digitisation does to manual labour. Routine, repetitive jobs like that of typists and assembly line workers diminished but ones that required quick judgement and initiative, like those of executive assistants and burger flippers, remained. But this time, say experts, things are different – and tougher. 

3. I, (or) Robot?

Artificial intelligence means that robots are getting smarter and more sophisticated. They learn on the go, and get better over time. People are starting to rely on digital assistants, whom they have to pay less and can be assured of good service – and some indicators say, this is the way forward. Accountants, financial planners, paralegals and other such professions that earlier were reserved for the brilliant among us, are starting to be accomplished by robots. 

4. It’s not as bad as it sounds

While experts debate the future, the ground reality is said to be quite different. In 2019’s first quarter, the US unemployment rate was at a historical low despite the increasing number of women entering the workforce.Technological progress is definitely taking place, but it isn’t replacing the working man as quickly as one might have thought – but this is just the beginning. 

5. What can we do?

One reason more businesses are investing greater amounts of money in R&D is that hiring robots is cheaper and leaves them less liable, especially in terms of tax. Capital is taxed lower than labour and the expenses that come with helping an employee become a better worker are often separate. While we cannot force companies to continue spending more on their employees without risking lower growth, alienation from the business community or even worse, outsourcing of labour, we can definitely tax companies more on robots they employ. However, this raises another question – 

If robots replace human labour, can it not also create new opportunities for employees to engage in better work as menial tasks are automated?

Abhijit Banerjee and Esther Duflo analyse the past to learn about the future in ‘AI’, which will be free as an answer to our Question of the Day on 12th July.

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