Thoughts on Automation

I follow some economists on twitter. Some of these academics and researchers explore the effects of automation.

One particular researcher consistently points out that automation is decreasing
I’ve pointed out that such claims are strange for several reasons:

How are you defining automation?

There are two main types of automation: 1) physical control automation and 2) data processing automation

Industrial automation is increasing exponentially, data is accumulating exponentially, computing power is increasing exponentially, etc.

On an abstract level, automation is constructing little f(x)=y functions with building blocks, ie ideas, devices.

Functions are meant to optimize productivity, by isolating variables to create consistent, predictable outputs. There’s efficiency gains. Also efficacy gains in quality etc and sourcing inputs.

Pure Capitalism/free markets thrives off of, and rewards, any efficiency/productivity gain
IE anyone who builds a new function
Automation is so ubiquitous that’s it’s become invisible. Technology is automation.

To argue that automation is decreasing seems insanely ignorant.

I think his objective is to show that automation is decreasing, and thus not to blame for inequality. Because mainstream economists and other theoretical ignorants equivocate automation with inequality, ie machines take peoples jobs away. When In reality, it creates structural unemployment, ie automation creates new markets and this requires an adaptable labor force. Structural unemployment being a change in the type of labor demand, not a change in the total labor demand, i.e. frictional unemployment.

Economists define it in weird ways.

I asked the question in response to a paper claiming automation is decreasing, and they said:

“well, they don’t actually measure it, it’s derived from changes in wages and supply. Many people have used their earlier results to claim automation led to inequality.”

Referencing automation is hard. Are we speaking of Data processing automation or Physical controls automation or both?

Google is automated search.

Banking apps are automated banking

Vending machines are automated retail.

Automated Car washes.

Automated self check out.

There are machines that have automated a lot of things.

Agriculture is HUGELY automated. Takes a single farmer to do the work of dozens with a few machines.

Manufacturing/industry has been increasingly automated: if you simply look at the number of robots sold per capital, you’ll see this is growing exponentially.

And robots are just a small portion of industrial automation.

As I see it, automation is driving every aspect of productivity.

Regarding the analogy to functions, productivity is a function of inputs:


A company is a function
A machine is a function
A device is a function
A formula is a function


When I think of a controls architecture, it’s just a function…

A function gives you outputs depending on inputs

x Inputs -> f(x) -> y outputs

The idea is that automation efficiently gives you outputs from given inputs.

You can hand mill a piece of metal by hand. It would take 10 hours by hand. Or you can use a CNC machine and it’ll produce that same metal in 1 hour. The value is the amount of time you saved. The machine was the function that made inputs that increased efficiency of outputs.

Division of labor is a function.

It like parses a big function into smaller functions, for optimized efficiency.

I could run a farm by myself, but my outputs would be limited. If I hire labor, I increase outputs. But the cost of inputs goes up. So I need to make up for it with extra volume in outputs.


It’s just the way I conceive automation
F(x)= y

Every device, machine, etc is automating so sort of inputs to get me outputs more efficiently

The free market capitalism economy should reward these efficiency gains by giving you more inputs so you can give people their outputs at a lower cost.

Time is money.

Value is a function of time.

Automation and productivity go hand in hand
The thing is, every new piece of automation creates a new market

It’s layers of markets which support each other.

The relationship between f and g is a new market

When you build a machine, you take away three manual labor jobs in one market (say car washing), and hire 6 more in another market (mining materials, electrical controls, engineering design, maintenance, etc)

The cost of labor is the only limiting factor in automation.

If labor costs are lower than the cost to automate, automation will not contribute to productivity gains.

Yes, one machine can do the work of 10 people, but if 10 people working together produces the same or more value at less cost….

No reason to automate
Equality drives automation
But I think we export inequality to other countries
Innovation or invention revolves around the ability to save time.

Make a process more efficient = save time.

Time is money.

Every software or hardware innovation contributes to reducing transaction costs in getting an output/desired outcome.

If you can’t save time, you aren’t increasing productivity.

Be it a product or a service.

These are just random thoughts in regards to this whole:

Automation is decreasing
Automation takes jobs away
Automation contributes to inequality

This is any device/ machine/invention.

Except the value that’s created is literally a function of time. The value of any give outputs is a function of time.

If a function saves time in producing an output, it adds value.

Complexity occurs when there is variability.

The more variables in a function, the more complex, and the more processing required.

As a function itself, human intelligence or artificial intelligence is insanely complex, but applying it to functions increasing efficiency.

Intelligence is the ultimate complexity. But it creates simplicity. Creates order out of chaos.

Applying artificial intelligence to automation means more reliable machines, which can accommodate more variables, which means efficiency gains, which means value.
What is automation?

It’s so far reaching.

My oven automates the cooking process.

Like, machines automate. I.e. they save time processing inputs into desired outputs.

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