GOVERNMENT

Report: AI will increase the wealth

inequality between the rich and poor

ByRyan Daws
Editor of AI News. A gadget lover, music purveyor, and former host of a technology show.
Posted on January 11, 2018

Artificial intelligence advancements will increase the disparity of wealth between the
rich and poor, according to a new report.

The report titled “Artificial Intelligence and Its Implications for Income
Distribution and Unemployment” was presented last month through the National
Bureau of Economic Research.
Economists Anton Korinek (Johns Hopkins University) and Joseph E. Stiglitz
(Columbia University) believe economic inequality “is one of the main challenges
posed by the proliferation of artificial intelligence and other forms of worker-replacing
technological progress.”

The disparity of wealth between the rich and the poor is a global issue. A report from
Credit Suisse found the richest one percent own half of the world’s wealth.

“In the US, for example, the expected life spans of the poor and the wealthy have
diverged significantly in recent decades, in part because of unequal access to
healthcare and ever more costly new technologies that are only available to those
who can pay,” they state.
Korinek and Stiglitz believe we’re heading for a period similar to the Great
Depression when agricultural innovations meant fewer workers were needed to
produce food.

“There are clear parallels to the situation today in that a significant fraction of the
workforce may not have the skills required to succeed in the age of AI,” they wrote.

The researchers concur with a report we posted last September claiming AI will
create more jobs overall, but a lack of relevant skills will mean a vast majority of the
workforce are unprepared to fill them.
Rather than go down the route of a universal basic income, the researchers suggest
job subsidies may be preferable in this new age. This is due to the argument that
work can provide people with a feeling of purpose and dignity.

Until this point, the research is largely as many expected. The next part of the report
is where it becomes highly speculative and the stuff previously reserved for science
fiction.

The authors consider the possibility of the wealthy being augmented using AI to
provide them with an economic advantage. This can be seen on a lesser scale today
between the possiblities afforded to those who have access to higher-end
technology, and those unable. Even the ownership of a car opens up far more
possibilities.

“If intelligence becomes a matter of ability‐to‐pay, it is conceivable that the wealthiest

(enhanced) humans will become orders of magnitude more productive – ‘more
intelligent’ – than the unenhanced, leaving the majority of the population further and
further behind,” they write.

Not only would this increase the wealth inequality between the richest and poorest in
our societies, but it may also make them worse off in absolute terms. The report
makes it clear that some form of policy intervention is needed.