The impact of robotics on the economy.

For years, robots in industry have enabled the automation of simple tasks. So far, this has not led to higher unemployment, but the argument is that this is about to change.

The resulting extra prosperity will therefore accrue only to a few: the owners and managers of (large) companies. Initially, the gap between rich and poor will widen further. First, lower-skilled workers will lose their jobs, and no replacements will emerge for these roles. In the Netherlands, these individuals will end up in the safety net of unemployment benefits and social assistance. In other countries, like the USA, this will lead to severe poverty much faster. It is therefore easy to imagine that this could lead to enormous discontent and perhaps even revolutions. Hopefully, this will only be an interim period during which policymakers make adjustments so that everyone can benefit from increased prosperity. Developing and implementing effective policy is crucial to shaping this transition.

But ultimately, this development cannot be stopped, simply because it is possible and because significant money and power can be achieved through AI and robotization.

Redistribution of wealth

If, eventually, even highly educated individuals are forced into unemployment by artificial intelligence, the government will be compelled to intervene. This can be done by redistributing wealth between the (by then) super-rich and the unemployed. Because national governments will no longer have sufficient influence over multinationals, this requires collaboration. Let's assume the positive outcome where this is eventually achieved. We will then live with great freedom, leisure time, and prosperity until the moment the last job is replaced by smarter robots. At that moment, or just before it, the economy as we know it will disappear, and everything will be free. Robots produce everything, including the extraction of raw materials, and because they demand no compensation, they do so cost-free, 24 hours a day, 365 days a year. Consequently, the prices of goods and services will continue to fall until they eventually reach zero.

And then?

The economy has disappeared; being rich is useless because everything is free.

Will a shadow economy emerge, similar to the current divide between the underworld and the upper world, or will we try to distinguish ourselves in other ways? I don't know right now, but what I do know is that the scenario described above is plausible, and we must be prepared for both the period leading up to the disappearance of the economy and the period afterward.

But if we handle it correctly, we can achieve exactly what we have always wanted: more free time and enough income to lead a beautiful and fulfilling life. I find that thought worthwhile enough to continue investing in innovation.