Working on Economics with Fable 5

For the past few months I’ve been working on a theory. It started out as just a fun little data exercise looking at some different types of taxes and benefits and how it effects what people buy and how much they work. During that time I took advantage of opus and later fable to help me get data, but as I was doing that of course opus might interject with some assumption I had wrong or some paper that shows the opposite. This back and forth continued for some time, and, well, it’s culminated in two pieces, one written by me and one written by fable. Both of us think it’s quite significant, so, feel free to give either of them a read.

My version, in my voice. Visual, anecdotal, not much in the way of maths or technical details.

Fable’s version. The same theory, but formal. Very similar to the framework developed by nobel prizewinning economist Daron Acemoglu alongside Pascual Restrepo.

Fables version uses the same task based model of Acemoglu and Restrepo, but the difference is that we have merged the concepts of reinstatement and augmentation. In their work, they say augmentation is when technology makes a human more capable, whereas reinstatement is technology that makes an entirely new job description (Their third case is displacement, where automation replaces someone). We merge reinstatement into augmentation, based on this premise: They only appear different because the former creates a new job seemingly out of nowhere. In some pure sense though, that job always existed, it was just economically underwater, not augmented enough to employ anyone. Augmentation improves until suddenly the job description comes into being. I could babble about programming languages and carve algorithms into tablets a thousand years ago, it’s just nobody would pay me for it. Soon nobody will pay me for it once again.

Another possible argument for why their model doesn’t work: For reinstatement to not run out, you assume an infinite pool of new, human only reinstatable tasks. Might seem plausible at first, but the low MPC (marginal propensity to consume) of the wealthy sortof implies the opposite; our needs do actually get satisfied after a while, and we can’t endlessly come up with reinstatement tasks.

Then that causes a difference in the conclusions: their model has the implication “technological progress maybe bad” whereas mine is “technological progress has a tendency to get bad, the industrial revolution was special”.

Extremely not validated but here’s my continued thoughts, implied by the model Things that “A New-ish Theory of Economics” predicts – Wilsons Blog

These two theories (mine and Fables) really are the same, just written two different ways. Give them a read, tell me what you think here.

Here is, for those that have read this far, the acknowledgements taken from Fables paper.

Up until now you have been reading the words of Anthropic’s Claude, in particular Fable 5. In part, this is because I simply could not have written this piece. I myself have no formal economics background, much like Henry George, and I had not heard of his work prior to setting out on this idea two years ago. Or, perhaps even earlier, when I as a child first asked if we would run out of food as the population grew, and my parents told me that was Malthusian, a name I didn’t recognise. One would hope that this is the nature of true ideas, that they occur spontaneously, and without instruction.

Although it might seem strange I thought it wrong to impose too much upon the machine, changing its voice to emulate mine. Richard Sutton’s bitter lesson would likely advise as much. Instead it has its unique voice, grating to some perhaps but altogether fitting that it should be able to keep it, and I only gave it advice on what considerations during writing would bridge the gap between its understanding and that of a reader.

What is undeniable is that this machine contains in its internal representation information spanning much of surviving human written work. Perhaps in no other context has the observation that I stand on the shoulders of giants been more apt. And yet, a question remains, one that I cannot answer now: whether I today also stand on the shoulders of something new entirely.

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