Hmm, before you forced me to think harder about it, I was also thinking it basically comes down to the market value of the horse’s labor versus the price of feed. But you’re right that it’s not clear why tractors should decrease the market value of horse labor more than they reduce the cost of feed. To the contrary, by replacing horses they directly reduce demand for feed (lowering short-run prices, at least), in addition to the broader boost they give to agricultural efficiency overall.
Now I’m thinking the thing missing from that analysis is the other costs to keeping a horse. I am guessing those remained relatively stable (like horse productivity), but perhaps that stability is the issue. In contrast to the feed, other horse upkeep costs were not brought down by the tractor: shelter, veterinary help, and the farmer’s time required for horse care. So maybe the main story is the horse’s revenue product falling below those types of horse costs. (Tractors also have analogous costs, but presumably those are lower, proportionally.)
edit: Or maybe the answer is more to do with the fixed upfront costs of purchasing a horse (versus a tractor)? If so, that would seem to complicate the analogy with human employment.
edit2: Sonnet 4 is telling me lifetime horse upkeep costs (circa 1920) were 40x the purchase price, and feed made up half or less of the daily upkeep. So I guess it’s mostly about the non-feed upkeep costs. (The upfront cost is a bigger deal for tractors. In terms of operating costs, tractors have the advantage of very low costs when idle.)
Humans have a considerable up-front cost also—it’s called birth and childrearing!
Maybe absolute horse productivity actually has declined, at least for non-farm work. All the roads have been rebuilt for cars, there are no places to tie up my horse for a quick trip to the supermarket, etc. (For that matter, is riding horses on city streets even legal? Regardless, it’s certainly less convenient than it would’ve been in 1900.)
AI analogy: If a job consists mainly of communicating with other employees, it’ll become harder for a human to maintain the same productivity when 99% of those other employees have been replaced with AIs, even if the human is just as intelligent as before.
If there is less demand for hay from horses, that will not increase the supply much because cattle, sheep, etc. will pick up the slack.
Other funny thought: From a horse’s perspective, the Amish are an aligned superintelligence.
From the Amish perspective, is the broader US society something of an aligned superintelligence? Maybe “super” is too strong, but I think of the Amish position as a model for how I hope ASI treats humans.
I’m pondering editing the post to discuss this explicitly and acknowledge that it does weaken the analogy with AGI and humans. The issue is that AGI could bring down the costs more broadly than tractors did, which raises the question of why the marginal revenue product of labor would fall more quickly than the subsistence wage?
Thinking out loud, the thing is that there are analogs to the non-feed upkeep costs (shelter and farmer/veterinarian labor) for humans. Though some work, like composing poems, requires little more than physical sustenance to be performed well, most human production requires complementary inputs, principally various equipment or machinery. The question then comes down to whether you want to invest in such human-augmenting equipment as opposed to a fully automated solution.
For example, suppose total production is AhLαK1−αh+ArKr. Then optimal capital allocation means Kh/L∝(Ah/Ar)1/α so that human-augmenting capital falls as robot productivity increases relative to human-in-the-loop productivity. Then the real wage, the marginal product of labor, is proportional to Ah(Ah/Ar)1−αα. If both Ah and Ar grow exponentially, the condition for the wage to remain constant is that Ah grow at a rate 1−α times the rate at which Ar grows (where 1−α is traditionally taken to be 1/3). (Google Sheet simulation)
In this toy model, it is conceptually possible that human-augmenting technology, Ah, advances sufficiently quickly relative to full automation, Ar, to keep humans fully employed (at above subsistence wages) indefinitely. (And sufficiently deliberate policy could help.) But if, instead, Ah continues growing at 1-2% annually while Ar takes off at 10%+ rates of growth, human labor eventually becomes obsolete (in this toy model).
This seems like a whole other essay, rather than an edit to this one, though. I’m guessing the analogy to Ah for horses was relatively fixed during 1910-1960.
I think the question of ai controlled humanoid robots vs humans and horses vs cars is interesting. RethinkX on this subject is kinda scary. Humanoid robots amortized over 3 years and say 16-20 hours a day quickly go below minimum wage in America so the question of whether the economy has enough tasks for such a labor revolution that starts out not very general, but becomes more general use over time. So I encourage your thoughts on this topic, as I don’t know what framework to use to think about it
Hmm, before you forced me to think harder about it, I was also thinking it basically comes down to the market value of the horse’s labor versus the price of feed. But you’re right that it’s not clear why tractors should decrease the market value of horse labor more than they reduce the cost of feed. To the contrary, by replacing horses they directly reduce demand for feed (lowering short-run prices, at least), in addition to the broader boost they give to agricultural efficiency overall.
Now I’m thinking the thing missing from that analysis is the other costs to keeping a horse. I am guessing those remained relatively stable (like horse productivity), but perhaps that stability is the issue. In contrast to the feed, other horse upkeep costs were not brought down by the tractor: shelter, veterinary help, and the farmer’s time required for horse care. So maybe the main story is the horse’s revenue product falling below those types of horse costs. (Tractors also have analogous costs, but presumably those are lower, proportionally.)
edit: Or maybe the answer is more to do with the fixed upfront costs of purchasing a horse (versus a tractor)? If so, that would seem to complicate the analogy with human employment.
edit2: Sonnet 4 is telling me lifetime horse upkeep costs (circa 1920) were 40x the purchase price, and feed made up half or less of the daily upkeep. So I guess it’s mostly about the non-feed upkeep costs. (The upfront cost is a bigger deal for tractors. In terms of operating costs, tractors have the advantage of very low costs when idle.)
Humans have a considerable up-front cost also—it’s called birth and childrearing!
Maybe absolute horse productivity actually has declined, at least for non-farm work. All the roads have been rebuilt for cars, there are no places to tie up my horse for a quick trip to the supermarket, etc. (For that matter, is riding horses on city streets even legal? Regardless, it’s certainly less convenient than it would’ve been in 1900.)
AI analogy: If a job consists mainly of communicating with other employees, it’ll become harder for a human to maintain the same productivity when 99% of those other employees have been replaced with AIs, even if the human is just as intelligent as before.
If there is less demand for hay from horses, that will not increase the supply much because cattle, sheep, etc. will pick up the slack.
Other funny thought: From a horse’s perspective, the Amish are an aligned superintelligence.
From the Amish perspective, is the broader US society something of an aligned superintelligence? Maybe “super” is too strong, but I think of the Amish position as a model for how I hope ASI treats humans.
Yes! The insights from this analogy keep coming.
I’m pondering editing the post to discuss this explicitly and acknowledge that it does weaken the analogy with AGI and humans. The issue is that AGI could bring down the costs more broadly than tractors did, which raises the question of why the marginal revenue product of labor would fall more quickly than the subsistence wage?
Thinking out loud, the thing is that there are analogs to the non-feed upkeep costs (shelter and farmer/veterinarian labor) for humans. Though some work, like composing poems, requires little more than physical sustenance to be performed well, most human production requires complementary inputs, principally various equipment or machinery. The question then comes down to whether you want to invest in such human-augmenting equipment as opposed to a fully automated solution.
For example, suppose total production is AhLαK1−αh+ArKr. Then optimal capital allocation means Kh/L∝(Ah/Ar)1/α so that human-augmenting capital falls as robot productivity increases relative to human-in-the-loop productivity. Then the real wage, the marginal product of labor, is proportional to Ah(Ah/Ar)1−αα. If both Ah and Ar grow exponentially, the condition for the wage to remain constant is that Ah grow at a rate 1−α times the rate at which Ar grows (where 1−α is traditionally taken to be 1/3). (Google Sheet simulation)
In this toy model, it is conceptually possible that human-augmenting technology, Ah, advances sufficiently quickly relative to full automation, Ar, to keep humans fully employed (at above subsistence wages) indefinitely. (And sufficiently deliberate policy could help.) But if, instead, Ah continues growing at 1-2% annually while Ar takes off at 10%+ rates of growth, human labor eventually becomes obsolete (in this toy model).
This seems like a whole other essay, rather than an edit to this one, though. I’m guessing the analogy to Ah for horses was relatively fixed during 1910-1960.
I think the question of ai controlled humanoid robots vs humans and horses vs cars is interesting. RethinkX on this subject is kinda scary. Humanoid robots amortized over 3 years and say 16-20 hours a day quickly go below minimum wage in America so the question of whether the economy has enough tasks for such a labor revolution that starts out not very general, but becomes more general use over time. So I encourage your thoughts on this topic, as I don’t know what framework to use to think about it
Interesting, this is the first I’ve heard of them. Thanks, I’ll check this out: https://www.rethinkx.com/labor