AI and complements

In a “weak links” model of production, where tasks are complements, the gains from automation tend to arrive slowly because output is constrained by the least productive tasks. But the same complementarity makes attacks more harmful and easier to execute. For example, with an elasticity of substitution across tasks of 0.2, automating tasks worth 1 percent of GDP with a tenfold increase in productivity raises output by less than one percent, while cutting their productivity tenfold lowers output by 68 percent on impact. Whena larger AI sector simultaneously makes AI models more capable and attacks more likely, the positive productivity spillover is negligible compared with the potential damage, so the market overinvests in AI. In a weak-link economy, the costs and benefits from AI can be extremely asymmetric.

That is from a recent “in progress” manuscript by Charles I. Jones and Christopher Tonetti.  Via Lukas Freund.