We live in an age of paradox. New technologies match or surpass human-level performance in more and more settings, yet measured productivity growth has declined by half over the past decade, and real incomes have stagnated since the late 1990s for a majority of Americans. Syverson will describe four potential explanations for this clash of expectations and statistics: false hopes, mismeasurement, redistribution, and implementation lags. While a case can be made for each explanation, Syverson argues that lags have likely been the biggest contributor to the paradox. The most impressive capabilities of new technologies, particularly those based on machine learning, have not yet diffused widely. More importantly, their full effects won’t be realized until waves of complementary innovations are developed and implemented.
Presenter: Chad Syverson, Eli B. and Harriet B. Williams Professor of Economics