Much has been said about the economic impact of AGI, some of it is already been felt
But not much has been proposed about solutions.
Specifically, what approaches should policy makers take?
Here, I propose that policy makers should encourage two key trends – together which could alleviate the issues of AI – The Gig economy and Universal Basic Income.
The first trend is the Gig economy. The term “sharing” or “gig” economy refers to a growing trend, especially among young people, to eschew traditional asset ownership, such as houses and cars, in favour of a more flexible, experience-driven lifestyle. This trend reflects a significant shift in priorities, where experiences, from travel to entertainment, are valued more than acquiring physical assets.
Economic realities play a crucial role in this shift. For many young adults, the financial burden of owning a house or car is exacerbated by challenges like soaring real estate prices and substantial student loan debts. This economic pressure is steering them away from traditional ownership models. Additionally, there’s a growing environmental consciousness among this demographic. The desire for sustainable living and reducing one’s carbon footprint leads to a minimalist approach, favoring sharing or renting over owning.
Technological advancements have also catalyzed this trend. With the advent of mobile technology and various platforms, access to goods and services like ride-sharing and short-term rentals is more convenient than ever, diminishing the allure of ownership. Furthermore, living in densely populated urban areas with efficient public transport systems makes owning a car less of a necessity. In contrast, high property prices in these areas make home ownership less attainable.
This trend is more than an economic decision; it’s a cultural shift. Today’s young adults are redefining success and stability, choosing flexibility and freedom over the traditional path of accumulating possessions. This change in attitude is also reflected in their approach to life milestones like marriage and starting a family, which are often delayed in favor of less materialistic and more experience-focused lifestyles. This societal evolution marks a significant departure from previous generations’ values and aspirations, indicating a profound change in how young people perceive and interact with the world around them.
The second trend is Universal basic income. The advent of Artificial General Intelligence (AGI) brings forth solid arguments for implementing Universal Basic Income (UBI), addressing the socio-economic upheavals anticipated with advanced AI technologies. A central concern is job displacement; AGI’s ability to automate complex tasks, not just manual labor, poses a risk of widespread job losses. UBI offers a solution by providing financial stability to those whose employment is jeopardized by technological advancements.
Economic inequality is another pressing issue. The disparity in AI-driven productivity gains could widen the wealth gap, as those controlling the technology reap the most benefits. UBI presents a way to redistribute wealth more equitably. It also encourages innovation and creativity by providing individuals the financial security to pursue entrepreneurial and artistic ventures, potentially fostering a surge in cultural and innovative activities.
UBI’s role in combating poverty and enhancing welfare is significant. It ensures that basic living costs are covered for all, regardless of employment status in an economy influenced by AGI. This approach could also simplify the social security system, reducing bureaucratic complexities and associated costs.
Regarding workforce dynamics, UBI offers greater flexibility, allowing individuals to adapt, re-skill, or work intermittently without the risk of total income loss. This flexibility is crucial as work evolves with AGI’s integration. Moreover, during economic transitions brought on by AGI, UBI could stabilize the economy by sustaining consumer spending.
Ethically, there’s a strong case for ensuring that the benefits of AGI are shared universally, not confined to a select few. UBI supports this ethos, promoting a more equitable distribution of technological advancements. Additionally, UBI could enhance mental health and societal well-being by alleviating financial stress and insecurity, contributing to a more stable and contented society.
Finally, UBI is a step towards a more equitable society where access to essential resources and opportunities is a fundamental right, not dictated by job or income level. The proposal of UBI in the AGI era is rooted in the understanding that the traditional economic and work models are undergoing fundamental changes, necessitating new approaches to income and social security to adapt to these evolving conditions.
The trend is not unusual – already 66 countries offer digital nomad visas. I believe over time more countriews will and a combination of UBI and the gig economy, if encouraged by politicians, will help to overcome the challenges of work in the age of AGI.