Tech Tycoons have Got the Economics of AI Wrong

Even as economic growth was just removing, some economists were already pessimistic. Coal, composed William Stanley Jevons in 1865, is “the mainspring of modern-day product civilisation”. Yet it was finite and would quickly run out. Although more might be found by digging deeper, it would be progressively expensive to extract and these greater expenses would reduce the competitiveness of Britain’s producers. After all, in other countries the black fuel was still in sight of daytime. Efficiency gains-using less coal to produce the exact same amount of stuff-would not conserve the country. Indeed, cleverer use of minimal resources would simply offer an incentive to burn much more coal, which would, paradoxically, cause an even much faster usage of British reserves. There was no escape, the Victorian economic expert thought. Coal would be tired and the nation was most likely to “contract to her former littleness”.

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This article appeared in the Finance & section of the print edition under the heading “Rocked by DeepSeek”

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Tech tycoons have actually got the economics of AI incorrect

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