Economic Analysis of the Nanotech Future

nweaver writes "Economic Historian and Berkeley Professor Brad DeLong has created an analysis on his Web Log on the economic implications of Nanotechnology. His observations are based on what previously happened with the Industrial Revolution (and other economic shifts in general) and using this to speculate what Nanotech will do to the economy: who wins (technical/knowledge workers), who loses (manufacturing), and what changes (costs of products)."

Comments

Raises interesting questions

[Steve 'Rim' Jobs]

If, in the future, copying physical objects is nearly as easy as copying information on a computer, will corporations lobby to pass laws that make it illegal to do so? In other words, will I be arrested one day for making a copy of my friend's Ferrari?

Re:Raises interesting questions

[dustman]

Answer #1:
There will *always* be stuff which is scarce. Maybe it will be real estate. Maybe we will continue to impose artificial scarcity (i.e. intellectual property) on certain things. Maybe there will be some completely arbitrary measure of "status" that people value.

Read science fiction stories for examples of what will be scarce. (The "status" thing really was in a rather crummy science fiction story I read once.)

Whatever it is, scarce goods will have value, and some economy based around that value will exist.

Answer #2:
Perhaps we can build robots to do the bad work for us.

I believe that artificial intelligence is possible with enough processing power (and if we have nanotech, we will be capable of exceeding the processing power per cm^3 of our brains).

More important than just creating smarter versions of ourselves, though, is the concept of intelligence without personality. Something which is able to reason, but which does not have a "being" behind it.

Artificial intelligence built around this concept would not "turn on us" like the matrix. There would be no moral issues with shutting it off after asking it to solve a problem.

Re:Raises interesting questions

[Chris Y Taylor]

Years ago I read a sci-fi short story something like this. Aliens wanted to destroy Earth's economcy so they gave us (just left them out in public somewhere) a pair of devices that could copy anything. Of course, it wasn't too long before someone thought to copy one with the other and then before you know it everyone is getting them. The hero of the story was the manager of a large dept. store (like Macy's). In the morning when he goes to work it is a normal day and they are in business selling mass produced items. As the "duplicators" start showing up, he realizes that the old business model doesn't work anymore. He orders his staff to stop selling items for their marked price and to charge customers a small fee to copy anything in the store. He then orders the stores buyers to stop trying to get good prices on mass produced items and instead try to find one of every weird or unique thing they can. At the end of the day the store is still in business, but with a completely different business model, relying on good customer service and having a wide selection of unique items to be copied for a small price. Can anyone recall what the name of this story is or its author?

Of course there are some fields where we already have such "duplictor" based business models. The printing press made books the 1st such field. Now, of course, we have the same thing with music, software, and other information based businesses.

-Information wants to be free the same way that jewelry wants to be free.

Re:Raises interesting questions

[garyrich]

Lets grant the "star trek universe" enough of a widespread understanding that we can call it a thought experiment. It is one on many levels, but just look from the scarcity point of view. Your first point is wrong - there is a need for money. Currency, barter and other types of exchange are more and more important as you travel further and further out into the Harry Mud edges of the frontier. Granted, they don't seem terribly important on Earth and more highly developed planets. This would also be true with a late stage nanotech society.

Second, in that universe it seems pretty clear that not all things replicate equally well. Many luxury goods (wines, brandy, foods). Also some necessities - if you could replicate di-lithium crystals the society would not work the way it does. Nano would also work this way. Unlike the start trek universe 'tea, earl grey, hot' would be one of those things that molecular mfg wouldn't work that well for. There is a nano factory called a tea plant that produces a concentrated substance in its leaves that does a great job. Nano would/could go a long way to up yields on tea, automate care (aphid hunting nanobots would be preferable to pesticides) but the tea plantations are there to stay. Someone(s) still going to have to have to run the operation. Probably someone that is a hard core tea geek (yes, they exist) would do 80% for love of the process and 20% for those luxury goods that don't replicate well (maybe he's also a stinky cheese geek or collects antiques).

So, who cleans the toilets? A toilet that needs a human to clean it is a poorly designed toilet - why buy that model? "the droids would clean it" is a valid answer to some extent, but for the toilet example it should just be self cleaning.

In the larger sense it makes sense to ask "who does the unpleasant jobs, whatever they may be, there are bound to be some". As many reasons as there are people, I suppose. In the Federation we see many of these things done by star fleet folks. They do it for pride of position, duty, a tradition of public service, earning their way into the company of those they respect (same reason we humiliate recruits in boot camp). Hard scrabble miners do it in hopes of great riches (what does that mean? It clearly still means something) and probably because they don't 'play well with others' and couldn't get on in more civilized parts.

If pople are freed of having to spend most of they waking hours on basic survival they will find thngs to do. Some destructive, some stupid, some brilliant and some that areas that look to other people as crazy (why would someone spend 4+ hours a day working in a garden if they didn't need the $$/food?).

nanotech has a big future....

[dummkopf]

i have worked a bit in the field of nano-decorated surfaces. it is impressive that one can make little nano-sizes arrays of magnetic dots on some substrate . this as so small, that one can view them as single particles which switch homogenously. hence you can study the interactions of little magnetic particles in arrays and do experiments which are very close to theoretical models, such as the Ising model. why should you care? because this nano-patterns seem to be interesting for exchange biased systems. and these seem to be interesting for the recording media industry. but why should you care... this is too geeky anyways. this guy (AKA Prof. Kai Liu) at UC Davis does some interesting research with nanostructures... cool pics and some explanations...

This is the wave of the future

[BadCable]

I think that the idea of artificially enhancing ourselves with technology is the right approach, but the BORG technique of implanting high-tech computerized devices seems the wrong approach. Basically, this would open up our very bodies to hackers. By now we should all be aware how very difficult a problem computer security is. Personally I feel that computers and networks can never be made secure, and thus we should stop trying. Just imagine the inevitable result when some black-hat cracker breaks through the encryption protecting your enhanced liver, and proceeds to turn it into 'reverse', whereby it spews toxins into your bloodstream? Compound this with the fact that probably our bodies will be running Microsoft operating systems, and you see why this is the wrong approach.

The correct way to enhance ourselves is the technique outlined by Science Fiction Author Larry Niven. In variou Niven novels and short stories, the characters can live for hundreds of years by means of organ banks. If you lose an arm, use nanotechnology to put on a new arm. Of course, this will require two developments: improved nanotechnology, and the development of organ banks for all body parts. Probably this will lead to the death penalty becoming the standard punishmnent for every minor crime, so as to keep the organ banks full of fresh organs, allowing rich people to live forever at the expense of everybody else.

I hope this happens within my lifetime, as it is a Utopian scenario indeed.

Interesting . . .

[shystershep]

He provides an interesting framework for analyzing the issue, but I don't know that I agree with his conclusions that nanotech will increase the demand for highly-educated labor, thereby increasing income inequality. I think any shifts in income equality will come from a straight loss of manufacturing jobs rather than an increase in the need for educated workers. If nanotechnology is to be economically feasible, it will have to rely on automation to the same or a higher degree than current manufacturing techniques. Other than R&D, there won't be any need for more education, because extra schooling is probably more of a liability than an asset when it comes to running a machine on an assembly line.

This is also analogous to the technological revolution, because a much higher number of workers were left unemployed by the increase in productivity than moved to the cities and became factory workers -- witness the enormous social turmoil at the turn of the century. The relatively higher American education levels probably had a much greater impact in the service sector than manufacturing 50-100 years ago. Although level of education has picked up somewhat in the last decade or so (concurrent with America's resurgent dominance in non-military technology), compared to other industrialized countries American education below the college level simply sucks.

Frontiers and Nanotech

[randall_burns]

I would suggest the conditions in Britain were largely due to the closing of the American frontier in the mid 1800's. Until that point, there was a floor under wages(i.e. British industrialists couldn't pay their workers so little they didn't bolt and risk death and disease on the frontier). The point here is that the order in which advancements move towards nanotechnology are quite important.

I would also suggest folks look at the Nanotechnology timeline Sean Morgan did. Best estimates are this will unfold the next 20 years or so. The nice thing about Morgan's work is that he talks about some of the incremental advancements between now and then.

Freudian Slips While Reading

[EvilTwinSkippy]

The filters between my eyes and brain might be trying to tell me something.

At first glance I read "Economic Analysis of the Nanotech Failure". I'm not sure if it was trying to say Nanotech is going nowhere, or that the grey goop effect will make pollution look like a spot on one's trousers by comparison.

For my part, I'm not really thrilled by Nanotechnology. It's like being thrilled by quantumn mechanics. Sure it's neat, but unless you are a researcher it's not going to be used in anything you buy, build, or are likely to use. Oooo, it will make already small computer chips smaller. Whoopie. The size of a computing device is currently limited by the size of the battery, power supply, or human interface device.

As far as medical uses, the nanotechnology itself is useless without some way of coordinating the activity of millions of simple robots. That technology isn't nanotechnology. I call the ability to harness millions of independent units "Taonology", and it's first application will be social engineering.

(Checking time-traveler's guide to 2003 to make sure it's been invented.) Scratch that. But when it happens, act surprised.

Re:Nanotech is XXIst century AI

[Artifakt]

The potential benefits of superconductivity are very large. Take New York city, for example. Some months half the electricity they buy is used pushing the other half across hundreds or even thousands of miles of high-tension lines. What would be the financial benefit of saving 50% on your electric bill for the entire city of New York?
Superconductivity is a pipe dream, in that even that absolutely enormous potential savings, multiplied by all the similar situations elsewhere in the world, isn't motivating anyone to build a working superconducting transmission system and save that enormous amount of wasted power. If it's feasable, why hasn't a demand that large produced a result? The theoretical benefits of superconductivity certainly ARE large enough to matter - ergo, the limitation must be practice, not theory.
As a lesser example, Superconducting Magnetic Levitation was supposed to enable a generation of high speed trains that could compete with the aircraft industry. The Japanese just set a train speed record of 585 Km/h. They did it with a non-supercoducting system. Why did they do it the "hard way", if superconducting technology is more than a laboratory curiosity?