Tech Tycoons have actually Got the Economics of AI Wrong

Even as financial development was simply taking off, some economists were already pessimistic. Coal, wrote William Stanley Jevons in 1865, is “the mainspring of modern-day product civilisation”. Yet it was finite and would soon go out. Although more might be discovered by digging deeper, it would be significantly expensive to extract and these greater costs would minimize the competitiveness of Britain’s makers. After all, in other nations the black fuel was still in sight of daylight. less coal to produce the exact same quantity of stuff-would not save the country. Indeed, cleverer use of minimal resources would merely provide a reward to burn much more coal, which would, paradoxically, cause an even much faster usage of British reserves. There was no escape, the Victorian economist believed. Coal would be exhausted and the nation was most likely to “agreement to her former littleness”.

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

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Tech magnates have got the economics of AI incorrect

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