Tagged: economic growth

Industrial Revolution #4

Paul Krugman at New York Times consumes Robert Gordon’s analysis of economic growth and the role of technology and comes up more hopeful than Gordon. The kernel in Krugman’s hope is that Big Data analytics can provide a shortcut to intelligent machines by bypassing the requirement for specification and programming that was once assumed to be a requirement for artificial intelligence. Instead, we don’t specify but use “data-intensive ways” to achieve a better result. And we might get to IR#4, following Gordon’s taxonomy where IR stands for “industrial revolution.” IR#1 was steam and locomotives  IR#2 was everything up to computers. IR#3 is computers and cell phones and whatnot.

Krugman implies that IR#4 might spur the typical economic consequences of grand technological change, including the massive displacement of workers, but like in previous revolutions it is also assumed that economic growth built from new industries will ultimately eclipse the negatives. This is not new, of course. Robert Anton Wilson argued decades ago for the R.I.C.H. economy (Rising Income through Cybernetic Homeostasis). Wilson may have been on acid, but Krugman wasn’t yet tuned in, man. (A brief aside: the Krugman/Wilson notions probably break down over extraction and agribusiness/land rights issues. If labor is completely replaced by intelligent machines, the land and the ingredients it contains nevertheless remain a bottleneck for economic growth. Look at the global demand for copper and rare earth materials, for instance.)

But why the particular focus on Big Data technologies? Krugman’s hope teeters on the assumption that data-intensive algorithms possess a fundamentally different scale and capacity than human-engineered approaches. Having risen through the computational linguistics and AI community working on data-driven methods for approaching intelligence, I can certainly sympathize with the motivation, but there are really only modest results to report at this time. For instance, statistical machine translation is still pretty poor quality, and is arguably not of better quality than the rules-based methods from the 70s and 80s in anything other than scale and diversity of the languages that are being used. Recent achievements like the DARPA grand challenge for self-driving vehicles were not achieved through data-intensive methods but through careful examination of the limits of the baseline system. In that case, baseline meant a system that used a scanning laser rangefinder to avoid obstacles while following a map and an improvement meant marginally outrunning the distance limitations of the rangefinder by using optical image recognition to support a modest speedup. Speech recognition is better due to accumulating many examples of labeled, categorized text, true. And we can certainly guess that the relevance of advertising placed on a web page is better than it once was, if only because it is an easy problem to attack without the necessity of deep considerations of human understanding–unless you take our buying behavior to be a deep indicator of our beings. We can also see some glimmers of data-intensive methods in the IBM Watson system, though the Watson team will be the first to tell you that they dealt with only medium-scale data (wikipedia) in the design of their system.

Still, there is a clear economic-growth argument for the upshot of replacing workers in manual drudgery straight through to fairly intelligent drudgery, which gives an economist like Krugman reason for hope. Now, if the limitations of energy and resource requirements can just be replaced, we can all retire to RICH, creative lives.