Tyler Cowen

And we have met in real life, just so our listeners know.

They're ignoring the all-critical role of human imperfections in systems and institutions.

So the more powerful AI becomes, and I'm not a pessimist on that, the more it bumps against people who don't want to adopt it or institutional systems where that does not get incorporated into the workflows.

It also hits higher energy prices, constraints from data centers, possible regulatory constraints.

The general economic point is that as one thing in your economy gets better, the remaining imperfections become all the more important.

So they're not thinking about this like economists.

We're used to working in one sector of the economy where, yes, a lot has changed very rapidly.

But when you look at healthcare, education, government, the nonprofit sector, as you work in these, as I have, you will see the rate of improvement is going to be pretty slow.

You can look at particular self-contained systems.

One of the first we had was chess.

AI in chess is virtually godlike.

AI in programming is getting there.

It will take a little while, but it becomes a kind of self-contained system.

Maybe parts of graphic design.

But all that put together is well below 10% of the economy.

And once you have to interact with more complex processes,

We need to invent whole new ways of doing things.

We may need an entire generation of institutions and firms to die off and have new ones born again that are built around AI at its center.

And don't get me wrong, all of this, I think, is going to happen.

But it's much more like a 20-year time horizon.