Are We Approaching An Economic Singularity? Information Technology and the Future Of Economic Growth
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The concept of an economic singularity is defined as the point where the economic growth rate surpasses 20% per year, driven by superintelligent computers that render human input economically superfluous.
Nordhaus on the singularity:
Paper is a model/though experiment that attempts to gage how close we are to the Singularity, broadly defined as a point where human’s having no impact on economic performance, specifically defined as when the economic growth rate crosses 20% a year:“…intelligence moving toward superintelligence, which denotes “intellect that is much smarter than the best human brains in practically every field, including scientific creativity, general wisdom and social skills.”…. At the point where computers have achieved superintelligence, we have reached the “Singularity” where humans become economically superfluous in the sense that they make no difference to economic performance. Superintelligent computers are the last invention humans would make, as described by the mathematician Irving Good (1965) as follows: Let an ultraintelligent machine be defined as a machine that can far surpass all the intellectual activities of any man however clever. Since the design of machines is one of these intellectual activities, an ultraintelligent machine could design even better machines; there would then unquestionably be an “intelligence explosion,” and the intelligence of man would be left far behind. Thus the first ultraintelligent machine is the last invention that man need ever make. This point at which the rate and breadth of technological change will be so great is sometimes call the “Singularity” in a sense analogous to passing over the event horizon into a black hole - here the event horizon is where the forces of computer intelligence leave no room for human interventions…I define Singularity as a time when the economic growth rate crosses 20% per year…”
He then goes on to talk about the economic of the singularity, “…Put more precisely, and as will be developed below, we might think that Singularity can arise from either the demand or the supply side. Rapid growth in both cases results from substitution toward high-growth inputs or outputs and away from stagnant inputs or outputs. On the demand side, rapid growth would occur if preferences are such that consumer spending moves increasingly toward high-productivity-growth industries as relative prices change. This is Baumol’s cost euphoria. On the supply side, Singularity would occur if production has sufficient substitutability that the input bundle moves toward rapidly improving information capital as growth proceeds. I begin with the demand side and then move to the supply side…”
William Nordhaus, “Are We Approaching An Economic Singularity? Information Technology and the Future Of Economic Growth,” Yale University, January 2, 2017, https://www.nber.org/papers/w21547.pdf