AI replaces scarcity with abundance. Economics is the discipline for management of scarcity. Will AI make economics irrelevant?

No, says Alex Imas “we will still have scarcity, but the kind of scarcity that matters will change.”

It may be reasonable for an economist to be unable to accept the need for his daily business disappear, so he goes on with a lengthy essay and CES-modelling to find the new kind of scarcity that AI presumably will conway.

And he finds it. As AI turns everything into robotics, humans will start missing the real human interaction they get for free in our pre-robotic societies. The AI revolution thus as a side-effect produces the continued need for the discipline of economics - now turning it’s focus on the management of the new scarce commodity: “relational experiences” that can substitute for the lack of human interaction produced by the same AI-revolution.

It is not so simple that we humans can just take our new abundance and enjoy the good life of free time in happy togetherness without ’economics’. As old Marx long ago told us: ‘Capitalism is about commodifying everything’. So capitalism will rescue the discipline once more: this time by creating new markets for a lot of ‘relational commodities’ for the economists to study.