This episode continues our investigation into the potential wide-ranging implications of advanced AI for economics.

Traditionally, value is said to be created by a combination of capital, which covers the cost of materials and equipment, and labour, whereby humans exercise skills, ingenuity, diligence, attention, and more. What has been a constant debate is the appropriate division of rewards between capital and labour. Critics of the operation of capitalism have often predicted that an accumulation of value within small groups of owners of capital will cause economic instabilities and a subsequent collapse. Despite these forecasts, capitalism has, so far, demonstrated great resilience, defying predictions of its collapse. But if human labour is increasingly displaced by advanced automation, the balance of labour and capital will be fundamentally changed, and capitalism will come under unprecedented pressures.

That’s the thesis of our guest today, Ted Shelton. David first met Ted about 25 years ago, when Ted was Chief Strategy Officer of the software development tools company Borland, and David was an executive within the early smartphone industry. Since that time, Ted has worked for a variety of companies in and around Silicon Valley, including PwC, Cognizant Technology Solutions, Catalytic, Bain, and Inflection AI. Recently, he has been giving a great deal of thought to where AI is taking the economy.

Selected follow-ups:

• Ted Shelton's posts on LinkedIn
• "On the Transformation of Capitalism's Fundamental Assumptions Under Conditions of Scaling Machine Intelligence" - working paper by Ted Shelton
• "The Industrial Economy Is Ending. What Comes Next?" - by Ted Shelton
• Thomas Piketty's book "Capital in the Twenty-First Century" - Wikipedia
• Nicholas Eberstadt's book "Men Without Work: America's Invisible Crisis" - Wikipedia
• Richard Sutton's essay "Bitter Lesson" - Wikipedia
• "Technofeudalism" - articles by Yanis Varoufakis

Music: Spike Protein, by Koi Discovery, available under CC0 1.0 Public Domain Declaration

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