In a piece I published a few months back titled “Abundance, Scarcity, and the Future of Work in an AI World,” I made the argument that there’s unlikely to ever be a world of unlimited abundance.
The reason? As something becomes abundant, things adjacent to it will seem relatively scarce given humans’ insatiable appetite for making progress in struggling circumstances. Much of my argument rested on the application of three theories that have been rigorously tested—interdependence and modularity, commoditization and de-commoditization, and the law of conservation of attractive profits.
One implication of my argument is that we’re not heading to a jobless future in the age of AI.
I’m not the only person making similar arguments.
In his Substack post, “Plentiful, high-paying jobs in the age of AI,” Noah Smith (with a hat tip to David Deming for the reference) wrote:
“How can this be true? Well, maybe it’s because we invent new tasks for humans to do over time. In fact, so far, economic history has seen a continuous diversification in the number of tasks humans do.”
In response to Johannes Hoefler asking, “AI being a compute and energy dependent resource, will become exponentially lower cost just as microchips and solar panels have done when demand went up? What is left of your argument in reality, if the comparative advantage is not relevant anymore because of an abundance of AI?”, Smith continued:
“No. In fact, there is no amount of physical abundance that will make comparative advantage irrelevant here. The reason is that the more abundant AI gets, the more value society produces. The more value society produces, the more demand for AI goes up. The more demand goes up, the greater the opportunity cost of using AI for anything other than its most productive use.”
The natural question then is what will become relatively scarce?
As Alex Imas (with another hat tip to David Deming) posited in a post titled “What will be scarce?”:
“A lot of analysis takes the economy as given: there is a set of jobs and a set of goods/services produced by the economy. If the same set of goods/services can be produced by cheaper machines, then these machines replace humans and the jobs disappear. But the economics of structural change, combined with deep-seated features of human preferences, suggests something different: as people get richer, they don’t just want more commodities. They want things that aren’t commodities in the standard sense of the word. The social aspects of products such as the relationships, the status, and exclusivity—what Rene Girard called the mimetic properties of desire—become much more relevant once people’s basic needs are satisfied. And the demand for these properties will bring the human element back into the production process, and with it, the jobs.
If this is right, then AI won’t just automate the commodity economy. It will trigger the emergence of something new: a post-commodity economy, where a growing share of expenditure goes toward goods and services whose value is inseparable from the human who provided them.
The same economic forces that moved 40% of the American workforce off farms and into factories and offices will move workers out of automatable commodity production and into what I’ll call the relational sector. By this I mean the human-intensive, provenance-rich, sometimes artisanal part of the economy where the human aspect is part of the value of the good or service itself. The economics of scarcity won’t disappear, it’ll just relocate.”
I agree with Imas’s analysis that parts of the economy where the human touch is inextricably tied to the value of the service are likely to increase in relative scarcity—particularly those tied to origin, presence, and participation: knowing who did something, being there when they did it, and experiencing it alongside others. It’s why within Imas’s broader human-intensive sector, one category strikes me as particularly likely to gain value: synchronous, in-person human experiences. And one of the most obvious examples is live performance.
