The Industrial Revolution analogy for AI and wages is overwrought, economist argues
Afinetheorem · x · 2026-10-07
The author pushes back on the common analogy between AI's wage impact and the Industrial Revolution. During England's "Engel's Pause," 15-20 percentage points of the population shifted from agriculture/local production to the modern economy or urban areas while growth ran below 0.5% — huge structural change, slow growth. By contrast, episodes of structural change paired with high growth (East Asian miracles, US urbanization 1870-1920) saw no wage decline; growth is highly correlated with wages over time.
Related event: Economists Push Back on the Industrial Revolution Analogy for AI(2 posts)→
More from AGI Musings
- AI Bottlenecks: a 2am side project now read by investors, semis and AI labs — demian_ai · 2026-10-08
- OpenAI preprint claims matrix multiplication exponent drops to 2.25, biggest leap since 1979 — BorisMPower · 2026-10-08
- Math was like Go until brute-force compute won — now mathematicians should ask better questions — xwang_lk · 2026-10-08
- Taste isn't the differentiator — just throw more tokens and intelligence at it — zebird0 · 2026-10-08
- Ugly, Brute-Force Solutions Win: AI Circle Debates What Our Taste for Elegance Cost Us — shakoistsLog · 2026-10-08
- tszzl: Training models to do AI R&D is far harder than training them to do math — tszzl · 2026-10-08