Dr. Daniel Sutter: The AI economy still depends on human nature
Dr. Daniel Sutter: The AI economy still depends on human nature
https://yellowhammernews.com/daniel-sutter-economics-and-artificial-intelligence/
Publish Date: 2026-05-31 07:00:00
Source Domain: yellowhammernews.com
Will Artificial Intelligence (AI) liberate or enslave humanity? As an economist with zero technical expertise, I will not venture a guess. But some economic fundamentals offer some perspective on the AI economy.
AI will significantly transform the labor market. The potential jobs apocalypse is not my topic today. Many cognitive jobs will surely be automated, as physical tasks have been for decades. Until AI, only humans trained in the field could answer law or accounting questions. We will need fewer lawyers and accountants, but we will still need some.
But AI will not abolish scarcity. Indeed, data centers need enormous amounts of electricity, both of which will need materials. AI will not make everything free.
Tech gurus often overlook the subjectivity of economic value. Goods and services are valuable because people exchange valuable things for them. Value arises from our personal and varying preferences. Something can be worth millions to one person and nothing to another.
No one must justify their expenditure to others in a market economy. And firms seek to deliver the goods and services customers want, whatever they might be.
Subjective preferences will likely slow or limit the dissemination of AI-enhanced products. To take one example, consider novels, poems, and travel stories. Do you wish to read AI generated novels or travelogs? Perhaps. Yet many readers value the encapsulated human perspective on life as opposed to the string of words.
An important source of value creation in the AI economy consequently should be guaranteeing human experiences. A publisher catering to readers wanting books written by humans must exclude AI-generated content.
Subjective value will also impact AI-enhanced services. AI will be able to provide legal advice and medical diagnoses comparable to humans. Tech experts may view AI services as equivalent to human services, but value arises from the human users. Some people will want a human…
