9. About Tyler Cowen
• Prof of Economics @
George Mason U
• Has an awesome blog:
Marginal Revolution
• Intellectual omnivore:
economics, art, fame, chess,
culture.
17. Core Messages from “Average Is Over”
• Mechanized intelligence is here
• Mechanized intelligence is going to
substantially change the world, its
economies and our lives
• We are entering an age of increased
and increasing inequality
• Understanding / exploiting
mechanized intelligence represents
your best road to winning in the next
round of the game
18.
19. “There’s never been a worse time to be a worker
with only ‘ordinary’ skills and abilities to offer,
because computers, robots, and other digital
technologies are acquiring these skills and abilities
at an extraordinary rate.”
- Erik Brynjolffson and Andrew McAfee
“The Second Machine Age”
26. “The key question will be: Are you good at working
with intelligent machines or not? Are your skills a
complement to the computer or is the computer
doing better without you? Worst of all, are you
competing against the computer? Are computers
helping people in India and China compete against
you?”
Tyler Cowen
Average is Over
pg 4&5
28. Jan Hein Donner, Dutch chess Grandmaster
& 11 time chess Olympiad participant
“I would bring
a hammer.”
29. People have been getting nervous about
mechanization for centuries
30. • Ned Ludd
• Late 1700’s
• Credited with leading a
revolt / movement
against mechanical
knitting machines
• Luddites fought literal
war with British
government
31. Interesting reality about knitting machines
• Worldwide clothing
industry grew rapidly
upon introduction of
knitting machines
• Millions employed to
this day, thanks to the
machines
32. It’s easy to be afraid
when machines
encroach upon your
personal domain.
34. My goal today: Discuss mechanized intelligence in the
context of “Average is Over”
• Examples of Mechanized Intelligence
• Some implications for the economy and the world
• Things you (and I) can do
– Warning: Things get really hopeful at the end
37. Abacus!
• ~ 8 centuries old
• Big enabler of early
commerce
• Aided in the invention
of Algebra
38. Graphing Calculators
• Invented in the 60’s
• 41% of world’s compute
capacity in mid 80’s
• Aided in invention of
personal computer
39. Personal Computer
• Launched in mid 70’s
• Big enabler of personal
productivity
• Aided in the invention
of Internet
40. Google
• Started circa 1997
• ~ 5,000 searches per
second in US alone
• Global web traffic
declined 40% when
Google was out for 5
minutes in summer 2013
41. IBM Watson
• Invented in 2004
• Won at Jeopardy in
2011
• Used to aid doctors in
triage at Sloan-Kettering
today
53. “It was true in the great Industrial Revolution and
it is true now: Machines do not put us all out of
work, as eventually machines create new jobs just
as they destroy old ones. It is also true that the
new machines of our age will rise to new and
different workplaces and create a new set of
winners and losers.”
Tyler Cowen
“Average Is Over”
Pg 20
55. Growth categories
• Complex computer systems management
• Data analysis
• Human motivation and performance
• Marketing and demand generation
• Direct personal service
• Man / Machine Teams
56. Computer analysis and control
F-16 => ~100 people per mission
Predator drone => ~170 people per mission
Global Hawk drone => ~300 people per mission
57. Who are those additional people?
• Communications, analysis and computer control people
63. “Computer use increases the need for skilled
workers, computers tend to increase workers’
autonomy and computers increase the need and
ability for management to monitor their workers.”
Tyler Cowen
“Average is Over”
Page 33
64. “It’s the manager who is the scarce input, and that
is one way to think about why managerial salaries
have been going up so much. Managers play a role
of growing importance in coordinating complex,
large-scale production processes.”
Tyler Cowen
“Average is Over”
Page 28
66. “Despite all the talk about STEM fields, I see
marketing as the seminal field for our future
economy… The more that earnings rise at the
upper end of the distribution, the more
competition there will be for the attention of the
high earners and thus the greater importance of
marketing.”
Tyler Cowen
“Average Is Over”
pg 22-23
70. “We can expect a lot of job growth in personal
services, even if those jobs do not rely very
directly on computing power. The more that the
high earners pull in, the more people will compete
to serve them.”
Tyler Cowen
“Average Is Over”
Pg 22
71. • Richard Eng
• Hong Kong’s Millionaire
Tutor
• 50K students in 12
schools
76. “Intelligent machines aren’t going to take over the
entire economy all at once, but they will slowly
revolutionize our economy. As each economic
sector utilizes the new intelligent technologies, the
notion of an effective man-machine team will
radically change and become extremely diverse.”
Tyler Cowen
“Average Is Over”
pg 49
77. Examples of man / machine teams
• Emergency room triage
• Automated DJ’s => “Denise”
• Freestyle chess teams
78. A few words about chess in
Tyler Cowen’s “Average Is Over”
• Dr Cowen really likes chess
• He writes about chess a lot in this book
• No, really, he writes about chess a lot in this book
• Seriously
• Dr Cowen thinks chess is way more interesting than I do
79. A few interesting chess bits
• Until the late 90’s, humans routinely beat computers
• In 1997, Deep Blue beat Garry Kasparov
• Today, cheap computer programs crush the best humans
• Freestyle teams – Humans with a computer aid beat the best chess
programs
– The best humans to team with a computer are NOT the best chess players
themselves
• When computers play chess against computers, it looks crazy
– Computers think of chess very differently than we do
80. What you and I should do about the advent
of mechanized intelligence
88. “The premium is on conscientiousness,
namely whether the worker can follow some
straightforward requests with extreme
reliability and basic competence.”
Tyler Cowen
“Average Is Over”
Pg 32
90. So our challenge for the day is to think of exactly
which mental abilities complement mechanized
intelligence. Off the top of my head, I can think of
a few mental types that will probably thrive in the
years ahead.
David Brooks
New York Times
Dec 9, 2013
91. Freestylers
“This skill requires
humility (most of the
time) and self-confidence
(rarely). It’s the kind of
skill you use to overrule
your GPS system when
you’re driving in a familiar
neighborhood but defer
to it in strange
surroundings.”
92. Synthesizers (eg Kirk Goldsberry)
“The computerized
world presents us with
a surplus of
information. The
synthesizer has the
capacity to surf through
vast amounts of online
data and crystallize a
generalized pattern or
story.”
93.
94. Humanizers
“Humanizers take the
interplay between man
and machine and make
it feel more natural.
Steve Jobs did this by
making each Apple
product feel like non-
technological artifact.”
95. And he cites others
• Conceptual Engineers
• Moralizers
• Greeters
• Economizers
• Weavers
97. The economic transition based on mechanized
intelligence is certain but it’s going to take years
and years
98. • MILWAUKEE, June 10, 2014 -- The latest Manpower Employment Outlook
Survey reflects continued hiring confidence among U.S. employers for
Quarter 3 2014, as U.S. employers report a seasonally adjusted Net
Employment Outlook of +14%. This is the strongest Net Employment
Outlook since Quarter 2 2008, when the Outlook was also +14%. The third
quarter Outlook is up from +13% in Quarter 2 2014 and from +12% during
Quarter 3 2013.
