Paul Romer

Promoters claim that AI is so powerful that it is close to being sentient. The reaction by Paul Romer, a Nobel Laureate in Economics who has been following the tech sector for four decades, is that close only counts in horseshoes and hand grenades. Since he clarified the fundamental difference between the dismal economics of scarce objects and the much more optimistic economics of ideas, he has seen wave after wave in which the tech sector uses this insight as an excuse to over-promise and under-deliver. His reaction to the new AI wave that took over after the collapse of the cryptocurrency wave, is that all the hype is based on a very dubious achievement: large language models (LLMs) can make up claims that have zero basis in fact, but which sound so convincing that many people believe them. As he notes in this clip, there are use cases where AI can generate real value – he cites the example of autonomous tractors that follow a leader piloted by a farmer – but the tech sector has failed to deliver on its grandiose promise that we’d soon have fully autonomous automobiles. Progress came rapidly in the beginning, and we’ve been close to having them for years now. He predicts that this is the pattern we’ll see over and over again, rapid progress that brings us close to the promised outcome. But close doesn’t count when lives are at stake.