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When Robots Meet Piketty

Why not think about robotics? The topic is hot (witness these five recent studies: 1 2 3 4 5). It is also the time of the year to look ahead. And, probably the most compelling reason, the topic is fascinating, multifaceted and potentially revolutionary, not only by adding things that yet don’t exist, but also by changing various aspects of many people’s daily lives.

Actually, robots are not so new. Think of the automobile industry and the medical sector for example. This holds even more when we see robotics as part of a broader trend, the digital revolution, which already has entered our lives. Is there anyone who does not use a smartphone or a route planner in the car or a smart thermostat at home? But what is new is the intensity of the changes that may lie ahead.

Machines that are not prone to the errors that people make because they are human

These changes have many positive sides. Robots that make life easier by doing a great deal of the housework, self-driving cars which make driving safer, machines that are not prone to the errors that people make because they are human, new devices that let handicapped people (deaf, blind, autistic) people participate in the labour market, technologies that allow people to consume things with considerably less waiting time. And those are only a few examples.

Our lives will become more vulnerable to technological failures [..]

There are downsides as well. People will lose their jobs and among them people who cannot easily acquire new jobs. That does not apply to all sorts of jobs, so inequality may also increase. Unemployment will increase as well if the economy embarks on a path that features a greater pace of innovation. In addition, our lives will become more vulnerable to technological failures if we continue to make ourselves more dependent on technology. And there is something about privacy.

Some of us are quite assertive about the future changes. In 2045 computers will have become the equivalents of the human brain, we will start wearing hypodermic sensors in the coming years and computers will occupy about half of current jobs in twenty years. That may be true, but often predictions turn out to have been too optimistic or too pessimistic at a later date. Who predicted ten years ago that smartphones would become our closest friend in only a couple of years? That many changes lie ahead is very likely, but the intensity, the timing and the form of these changes are quite uncertain.

It seems better to invest in those qualities that cannot be easily reproduced by robots

That the future is uncertain may sound obvious, but it has an important implication. Rather than trying to figure out which jobs will likely disappear in the future, it seems better to invest in those qualities that cannot be easily reproduced by robots: make sure that you are creative, that you can think out of the box, that you can come up with new ideas, that you are good in social interaction. Such investments will likely pay out in terms of better labour market careers, although the precise way this is going to work out is uncertain beforehand.

Both Piketty’s fundamental inequality [..] and the digital revolution [..] are arguments to consider seriously the taxation of private wealth

Robotics will also require government to rethink their policies. The case for technology policies in general seems weak, but policies toward the development of autonomous technologies deserve serious attention. Governments will also have to think about a legal framework for robots: who is liable for damages caused by a robot? Further, a case can be made for rethinking the tax system. It is not difficult to imagine a future in which only the very few people who are lucky to invent a popular robot to become astronomically rich (in fact, we see examples of this already today). Society can wait and see these people follow the examples of Bill Gates and Mark Zuckerberg and become philanthropists. Society can also choose not to take the risk that this is not going to happen and rather start taxing wealth at much higher than current rates. Here, robots meet Piketty: both Piketty’s fundamental inequality (the empirical fact that the rate of return on capital is higher than the rate of economic growth) and the digital revolution that features new industries that make very few people very rich are arguments to consider seriously the taxation of private wealth.

What then should one do in the meantime, before the robots come marching in? Keep your eyes and ears open and pick up everything that is interesting and relevant. No robot can do that for you.

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