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AI adoption and Solow's productivity paradox

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Re: AI adoption and Solow's productivity paradox

#451

Post by weatherlite »

fdefitte wrote: post #175
abraxas wrote: post #64

Earlier quoted context omitted.

What if LLMs are optimizing the average office worker's productivity but the work itself simply has no discernable economic value? This is argued at length in Grebber's Bullshit Jobs essay and book.

[dead]

> This is an underrated take. If you make someone 3x faster at producing a report nobody reads, you've improved nothing

In the private market are there really so many companies delivering reports no one reads ? Why would management keep at it then ? The goal is to maximize profits. Now sure there are pockets of inefficiency even in the private sector but surely not that much - whatever the companies are doing - someone is buying it from them, otherwise they fail. That's capitalism. Yes there is perhaps 20% of employees who don't pull their weight but its not the majority.

Re: AI adoption and Solow's productivity paradox

#452

Post by Wilder7977 »

aurareturn wrote: post #232
tabs_or_spaces wrote: post #218

My experience has been * If I don't know how to do something, llms can get me started really fast. Basically it distills the time taken to research something to a small amount. * if I know something well, I find myself trying to guide the llm to make the best decisions. I haven't reached the state of completely letting go and trusting the llm yet, because the llm doesn't make good long term decisions * when working a…

The future of work is fewer human team members and way more AI assistants. I think companies will need fewer engineers but there will be more companies. Now: 100 companies who employ 1,000 engineers each What we are transitioning to: 1000 companies who employ 10 engineers each What will happen in the future: 10,000 companies who employ 1 engineer each Same number of engineers. We are about to enter an era of explosiv…

And those companies will do what? Produce products in uber-saturated markets?

Or magically 9900 more products or markets will be created, all of them successful?

Re: AI adoption and Solow's productivity paradox

#453

Post by cucumber3732842 »

weatherlite wrote: post #450
abraxas wrote: post #64

Earlier quoted context omitted.

What if LLMs are optimizing the average office worker's productivity but the work itself simply has no discernable economic value? This is argued at length in Grebber's Bullshit Jobs essay and book.

> What if LLMs are optimizing the average office worker's productivity but the work itself simply has no discernable economic value? I think broadly that's a paradoxical statement; improving office productivity should translate to higher gdp; whatever it is you're doing in some office - even if you're selling paper or making bombs, if you're more productive it means you're selling more (or using less resources to sel…

Exactly. Even if they're doing bullshit it's a "bullshit make number go up" situation.

Society as a whole is no better off since no value or wealth was generated, but the number did go up.

A whole bunch of our economy is broken windows like this to varying degrees.

Re: AI adoption and Solow's productivity paradox

#454

Post by bildung »

simonw wrote: post #223
overgard wrote: post #187

Earlier quoted context omitted.

Does it matter if they can't ever stop training though? Like, this argument usually seems to imply that training is a one-off, not an ongoing process. I could save a lot of money if I stopped eating, but it'd be a short lived experiment. I'll be convinced they're actually making money when they stop asking for $30 billion funding rounds. None of that money is free! Whoever is giving them that money wants a return on…

It matters because as long as they are selling inference for less than it costs to serve they have a potential path to profitability. Training costs are fixed at whatever billions of dollars per year. If inference is profitable they might conceivably make a profit if they can build a model that's good enough to sign up vast numbers of paying customers. If they lose even more money on each new customer they don't have…

But only if you ignore all the other market participants, right? How can we ever reach a point where all the i.e. smaller Chinese competitors perpetually trailing behind SOTA with a ~9 month lag but at a tiny fraction of the cost stop existing?

I mean we just have to look at old discussions about Uber for the exact same arguments. Uber, after all these years, still is at a negative 10 % lifetime ROI , and that company doesn't even have to meaningfully invest in hardware.

IMO this will probably develop like the railroad boom in the first half of the 19th century: All the AI-only first movers like OpenAI and Anthropic will go bust, just like most railroad companies who laid the tracks, because they can't escape the training treadmill. But the tech itself will stay, and even become a meaningful productivity booster over the next decades.

Re: AI adoption and Solow's productivity paradox

#455

Post by bubblewand »

wolvesechoes wrote: post #333
Wilder7977 wrote: post #272

Earlier quoted context omitted.

Plus, a core part of what qualifies as a bullshit job is that the person doing it feels that it's a bullshit job. The book is a half-serious anthropological essay, not an economic treaty.

Yeah, guy states that in multiple places, and yet here we are, with an impression that most people referencing the book apparently didn't read it.

An odd tendency I’ve noticed about Graeber is that the more someone apparently dislikes his work, the more it will seem like they’re talking about totally different books from the ones I read.

Re: AI adoption and Solow's productivity paradox

#456

Post by rkomorn »

Wilder7977 wrote: post #452
aurareturn wrote: post #232

Earlier quoted context omitted.

The future of work is fewer human team members and way more AI assistants. I think companies will need fewer engineers but there will be more companies. Now: 100 companies who employ 1,000 engineers each What we are transitioning to: 1000 companies who employ 10 engineers each What will happen in the future: 10,000 companies who employ 1 engineer each Same number of engineers. We are about to enter an era of explosiv…

And those companies will do what? Produce products in uber-saturated markets? Or magically 9900 more products or markets will be created, all of them successful?

I don't understand the people who think more companies with fewer employees is a good thing.

I already feel spammed to death by desperate requests for my consumption as is.

Re: AI adoption and Solow's productivity paradox

#457

Post by metalman »

As a small bespoke manufactuter of things made out of metal, I have recently begun implimenting a policy of abandoning most online services, including banking, well almost as customers can still send me money online, but I have to go to a branch to see or get funds, except for monthly reports. It is awsome, the web brings me customers via 2 web sites, and searches useing AI, but the whole thing is asymetrical, as it has been more than a year since my last online purchase or filling out a form, aplication etc, all done on paper, in person, or I live without whatever it is. The result is a work environment that is focused on customers and production, and external obligations, requirements are litteral, as they must be managed efficiently in person and in such a way as to be finnished or stable, none of the death by 1000 emails brain rot. The mental state of haveing zero knowledge of what is happening on a millisecond by millisecond basis and letting everything go, and lo the world grinds on just fine without me, and I get a few things done. Mr Solow called it long ago, and my intuition has always been that the busy work was shit, and have now proven that in my one specific circumstance.

Re: AI adoption and Solow's productivity paradox

#458

Post by NoLinkToMe »

crispyambulance wrote: post #437

I accept that AI-mediated productivity might not be what we expect to be. But really, are CEO's the best people to assess productivity? What do they _actually_ use to measure it? Annual reviews? GTFO. Perhaps more importantly, it's not like anything a C-level says can ever be taken at face value when it involved their own business.

The latest company I worked in had your typical fee-earners and fee-burners categories of employees.

The fee-earners had KPIs tied to the sales pipeline, from leads to contracts to work completed on fixed contracts or hours billed on variable-rate contracts. It's relatively easy to measure improvements here. Though it's harder to distill the causes of that and tie it to LLMs.

The fee-burners like in IT, legal, compliance, marketing, finance, typically had KPIs tied to the department objectives. This stuff is a LOT more subjective and a lot more prone to manipulation (goodhart's law). But if you spend 60 hours a week on work in such a department, you tend to have a pretty good idea if things are speeding up or not at all. In a department I was involved in there was a lot of KYC that involved reviewing 300+ pages per case, we tracked case workload per person per day, as well as success rates (percentage of case reviews completed correctly), and could see meaningful changes one could attribute to LLM use.

Agreed though that I'm more interested in a few case studies in detail to understand how they actually measured productivity.

Re: AI adoption and Solow's productivity paradox

#459

Post by topocite »

cmiles8 wrote: post #28

I like AI and use it daily, but this bubble can’t pop soon enough so we can all return to normally scheduled programming. CEOs are now on the downside of the hype curve. They went from “Get me some of that AI!” after first hearing about it, to “Why are we not seeing any savings? Shut this boondoggle down!” now that we’re a few years into bubble, the business math isn’t working, and they only see burning piles of cash…

This is the standard stupidity here based on emotion and denial. This is the narrative that people want to hear.

Of course, trying to automate with chatGPT 4o was stupid. Trying to automate with Sonnet 4.6 will work better. Trying to automate with the models a year from now will work all the better.

To believe we are going to stop and go back to 2019 at this stage is seriously delusional.

I wish it were true. I would love to go back to 2019 but we obviously are not. We never go backwards.

Re: AI adoption and Solow's productivity paradox

#460

Post by aurareturn »

Wilder7977 wrote: post #452
aurareturn wrote: post #232

Earlier quoted context omitted.

The future of work is fewer human team members and way more AI assistants. I think companies will need fewer engineers but there will be more companies. Now: 100 companies who employ 1,000 engineers each What we are transitioning to: 1000 companies who employ 10 engineers each What will happen in the future: 10,000 companies who employ 1 engineer each Same number of engineers. We are about to enter an era of explosiv…

And those companies will do what? Produce products in uber-saturated markets? Or magically 9900 more products or markets will be created, all of them successful?

Go back to a time at the start of Youtube.

Now answer these questions:

And what will those people who make videos on Youtube do? Produce videos in uber-saturated categories?

Or magically 9900 more media channels will be created, all of them successful?

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