“On Comparative Advantage & AGI” by Charles Dillon 🔸

Cross-posted from my substack. Epistemic status: pretty confident, but willing to believe I’ve missed something somehow, hoping somebody smart will point it out if so. Level: pretty introductory, though assumes a bit of economics knowledge - if you’ve thought carefully or extensively about this particular topic I don’t expect you to find much of it novel. Introduction In a world with advanced Artificial General Intelligence, how do non-capital owners survive if their labour is outcompeted by AI? Recently, I found myself responding to one of the many Matts of economist/policy Twitter about the relevance of comparative advantage arguments for AI. Also recently, the excellent Seb Krier of DeepMind posted about a tool to illustrate comparative advantage he had built:[1] The tool does what it says on the tin - it shows how comparative advantage works, and how in an environment with both AI and human labourers, even if the AIs were substantially better than humans at everything, comparative advantage would still ensure there were things the humans should do to jointly maximise economic output. He does, in a response under the post, acknowledge that this is not sufficient to ensure human flourishing and we must rely on other mechanisms [...] ---Outline:(00:42) Introduction(03:46) Comparative advantage alone doesn't mean you get to eat(05:38) How we can ensure everyone eats anyway --- First published: December 3rd, 2025 Source: https://forum.effectivealtruism.org/posts/FLWRjCPQsiTiGfL36/on-comparative-advantage-and-agi --- Narrated by TYPE III AUDIO. ---Images from the article: is better at everything you do and requires less energy. I still think this is not quite grokking (in the original Heinlein meaning) it? Like I think the main unintuitive leap is that it's only the AI's opportunity cost that really matters." Matt Darling replies: "It doesn't matter what the AI can do better than me. That's not particularly interesting or important! It matters what the optimal use of the AI is. The more "G" the AGI is the stronger the optimal use is." Charles replies: "Horses have a comparative advantage vs humans with cars, and nonetheless the economy supports fewer horses than it once did."" style="max-width: 100%;" /Apple Podcasts and Spotify do not show images in the episode description. Try Pocket Casts, or another podcast app.

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