Socialist economies prioritized material balances and production targets over value added as a measure of economic growth. This was a serious mistake, as it promoted gross material production and inflated production rates. Consequently, Soviet "growth" rates were systematically inflated. It seems that AI advocates are falling into the same trap. There is no reason to account for "AI industries" differently from other industries. National accounts are fine, and AI is no different from, say, electricity generation or the printing press. If AI delivers significant new value added in the future, it WILL be included in GDP figures, both directly and indirectly. The direct value of "free chatting with AI" does not appear in GDP until it is monetized. However, GDP will reflect the actual value of the "chat" through hedonistic price adjustments. This won't be a perfect measure, but a portion of the product (mainly unmonetized) will be excluded. However, it will be a very small portion, and the measure will be good enough, just as it is good enough for Google services. It also won't be very large. Claims that "consumers are willing to pay huge amounts of money for internet/AI chats" are questionable. They aren't – that's precisely why prices for these services are low and competition is fierce – similarly to other services, such as VOD services. The indirect value added by AI will appear in GDP if and only if AI increases productivity in other sectors of the economy, much like the internet does today. This will translate into higher production per worker in other sectors, and therefore higher GDP globally. This is precisely how the "indirect" value added generated by electricity is represented. The direct value added of electricity generation is small – because electricity is cheap – but the abundance of electricity supports all other economic activities, so the value added from electricity is generated outside the energy sector. Therefore, there is no need to add anything to the energy sector's GDP to show "true electricity GDP". Just as there was never a need to adjust GDP for printing. Most of the economic benefits of the printing press did not originate in the printing industry, which, from its inception, immediately after Guttenberg's invention, caused a massive deflation in book prices. The "true added value of printing" occurred outside the publishing sector. And this is precisely what AI is all about.
Dwarkesh Patel
Dwarkesh Patel15.8. klo 22.00
As measured by GDP, AI will be super undervalued. How would the datacenter of geniuses show up in GDP? GDP would show raw inputs (aka chip & energy), and raw outputs (aka cost of tokens). But wouldn't clearly reflect the value of the crazy new shit that's being cooked up in those tokens. Similar problem to how the Internet's value is undercounted today (since many products are free, and thus contribute nothing to measured GDP). Perhaps the best way to measure the size of the future AI economy will just be our civilization's total energy use. Full episode with @CJHandmer out in a couple hours! (Credit to @jekbradbury and @gwern for mentioning this idea in conversation.)
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