7. Phil Trammell on Economic Growth under Transformative AI

Phil Trammell is an Oxford PhD student in economics and research associate at the Global Priorities Institute. Phil is one of the smartest person I know, when considering the intersection of the long-term future and economic growth. Funnily enough, Phil was my roomate, a few years ago in Oxford, and last time I called him he casually said that he had written an extensive report on the econ of AI. A few weeks ago, I decided that I would read that report (which actually is a literature review), and that I would translate everything that I learn along the way to diagrams, so you too can learn what’s inside that paper. The video covers everything from MacroEconomics 101 to self-improving AI in about 30-ish diagrams. paper: https://globalprioritiesinstitute.org/wp-content/uploads/Philip-Trammell-and-Anton-Korinek_economic-growth-under-transformative-ai.pdf video: https://youtu.be/2GCNmmDrRsk slides: https://www.canva.com/design/DAErBy0hqfQ/sVy6XJmgtJ_cYrGS87_uhw/view Outline: - 00:00 Podcast intro - 01:19 Phil's intro - 08:58 What's GDP - 13:42 Decreasing growth - 15:40 Permanent growth increase - 19:02 Singularity of type I - 22:58 Singularity of type II - 23:24 Production function - 24:10 The Economy as a two-tubes factory - 25:09 Marginal Products of labor/capital - 27:48 Labor/capital-augmenting technology - 29:13 Technological progress since Ford - 38:18 Factor payments - 41:30 Elasticity of substitution - 48:34 Production function with substitution - 53:18 Perfect substitutability - 54:00 Perfect complements - 55:44 Exogenous growth - 59:56 How to get long-run growth - 01:05:40 Endogenous growth - 01:10:40 The research feedback parameter - 01:17:35 AI as an imperfect substitute for human labor - 01:25:25 A simple model for perfect substitution - 01:33:09 AI as a perfect substitute - 01:36:07 Substitutability in robotics production - 01:40:43 OpenAI automating coding - 01:44:38 Growth impacts via impacts on savings - 01:46:44 AI in task-based models of good productions - 01:53:26 AI in technology production - 02:03:55 Limits of the econ model - 02:09:00 Conclusion