Daily Alpha · Substack
· Premarket Alpha · by Buzzberg Research
Economic researchers are challenging the prevailing narrative that AI automation inherently destroys jobs and increases inequality.
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AI Economics
Empirical data contradicts the thesis that robot adoption decreases employment and wages.
Critique of 'Power and Progress' automation thesis
Noah Smith argues that Acemoglu and Johnson's 'Power and Progress' relies on flawed historical examples, lacks empirical support for its 'steering' policy recommendation, and fails to account for recent data showing rising real wages and flatlining inequality during the AI boom.
Challenges the prevailing academic narrative that AI-driven automation is inherently labor-displacing and inequality-inducing, suggesting instead that market-based task creation may be offsetting automation effects.
Watch Monitor future labor market data for production workers; if real wage growth persists despite AI adoption, the 'automation-as-impoverishment' thesis will be further invalidated.
Source →Contradictory evidence on robot adoption and employment
Multiple studies (Mann & Püttmann, Dixon et al., Koch et al.) find that robot adoption correlates with higher employment and output, contradicting Acemoglu and Restrepo's 2020 findings that robots decrease employment and wages.
Suggests that firm-level robot adoption may be a net positive for labor demand, potentially invalidating the premise that automation is the primary driver of recent wage stagnation.
Watch Watch for further firm-level studies on automation; if the positive correlation between robot adoption and employment holds, it undermines the case for 'automation taxes'.
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