On October 14th local time, the Royal Swedish Academy of Sciences announced that the 2024 Nobel Prize in Economic Sciences was awarded to Daron Acemoglu, Simon Johnson, and James A. Robinson for their "research on how institutions form and their impact on prosperity."

The prize committee stated in a press release that these three economists demonstrated the importance of social institutions to a nation's prosperity. "Societies with weak rule of law and institutions that exploit their populations cannot generate growth or positive change, and their research helps us understand why."

Acemoglu was born in Istanbul, Turkey's capital, in 1967 and has been teaching at the Massachusetts Institute of Technology since 1993. He received the Clark Medal in 2005 and his research spans a wide range of fields including political economy, economic development, economic growth, technological change, inequality, labor economics, and network economics. He has co-authored numerous papers with the other two economists who shared the prize this time, and has co-authored best-selling books such as "Why Nations Fail" and "The Narrow Corridor" with Robinson.

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In recent years, one of Acemoglu's research focuses has been the impact of automation technologies such as industrial robots on the labor market. In 2023, his co-authored book with Simon Johnson, "Power and Progress," was published, discussing the dilemmas faced by AI as the most important technology of the current era.

"My research often focuses on the interaction between political economy and technological change, two major forces that shape our capabilities and growth opportunities, and also influence our political and economic choices," Acemoglu said in an exclusive interview with The Paper in June this year.

His research has found that the current trajectory of AI development is repeating and exacerbating some of the worst technological mistakes of the past few decades. For example, there is an overemphasis on automation without sufficient investment in creating new tasks. He believes that corporate leaders need to realize that their greatest asset is their workers, and instead of focusing on cost-cutting, they should look for ways to improve workers' productivity, capabilities, and influence.

Acemoglu is very concerned that AI will become a way to transfer wealth and power from ordinary people to a small group of tech entrepreneurs. To break the political power of large tech companies, he believes that "antitrust alone is not enough; we need to redirect technology towards a direction that is beneficial to society."

He proposed that three principles could guide the development of AI: first, prioritize the usefulness of machines; second, empower workers and citizens, rather than trying to manipulate them; and third, introduce a better regulatory framework to hold tech companies accountable.

On June 15th, Reference News cited a report from the American Cable News Network (CNN) that Apple surpassed Microsoft on the 13th to become the most valuable publicly traded company in the United States. Last week, the company announced a series of news, including generative AI features for the iPhone, at its annual Worldwide Developers Conference, causing its stock price to soar.Apple, Nvidia, and Microsoft have been fiercely competing for the throne of the world's most valuable company. After redefining "AI" as Apple Intelligence, Apple's market value surpassed Nvidia, whose value soared due to AI chips, and then caught up with Microsoft to reclaim the top spot. Currently, Apple's market value stands at $3.29 trillion, slightly higher than Microsoft's $3.28 trillion. Generative artificial intelligence has become the core driving force behind the market value increase of these three tech giants.

In the face of this AI boom, the National Bureau of Economic Research in the United States recently published a paper written by MIT professor Daron Acemoglu, pointing out that the productivity improvement brought by future AI progress may not be significant, estimating that the upper limit of AI's contribution to total factor productivity (TFP) growth in the next decade will not exceed 0.66%.

Acemoglu points out in the paper that generative artificial intelligence is a promising technology, but unless the industry undergoes fundamental repositioning, including significant changes to the architecture of generative AI models (such as large language models LLMs) to focus on reliable information and improve the marginal productivity of workers in various industries, rather than prioritizing the development of general-purpose, human-like conversational tools.

Acemoglu is skeptical about some overly optimistic predictions about the impact of artificial intelligence on productivity and economic growth. As a Turkish-born American economist, he is known for his research in political economy and has long focused on the interaction between political economy and technological change.

Last year, he co-authored a new book with British-American economist Simon Johnson, "Power and Progress," discussing the AI revolution that could overturn human society. They believe that the current development of AI has gone astray, and the design of many algorithms is to replace humans as much as possible. "But the way to make technological progress is to make machines useful to humans, not to replace them."

OpenAI Chief Technology Officer Mira Murati said at an event in May that in the controversy over the development of general artificial intelligence (AGI), they not only focus on enhancing the functionality and practicality of the model but also strive to ensure its safety, keeping it consistent with human values, and preventing it from getting out of control, thus creating AGI that benefits humanity.

"The deeper I delve into the capabilities and development direction of AI, the more convinced I am that its current trajectory is repeating and exacerbating some of the worst technological mistakes of the past few decades," Acemoglu said in a recent exclusive interview with The Paper (). Most of the top players in the AI field are driven by unrealistic and dangerous dreams, that is, the dream of achieving general artificial intelligence, "which is to put machines and algorithms above humans."

Some analysts regard Acemoglu as a pessimist about AI. He responded to The Paper, saying that as a social scientist, he would pay more attention to some negative social impacts.

Acemoglu often works with his wife, Professor Asu Ozdaglar, who is the head of the Department of Electrical Engineering and Computer Science at MIT. Although their fields are different, the couple's views on AI development are consistent in the big direction, but Acemoglu also admits that his ideas may be more pessimistic than his wife's.

As the commercialization of artificial intelligence accelerates, AI large models are competing, but there is no doubt that tech giants like OpenAI, Microsoft, Google, and Nvidia have seized the initiative in AI development. Acemoglu said he is very worried that AI will become a way to transfer wealth and power from ordinary people to a small group of tech entrepreneurs. The "inequality" we see now is the "canary in the coal mine."Technology and Society: The Greatest Asset is People

Q1: Your research covers political economy, technological change, inequality, and more. Under what background and opportunity did you start focusing on the role of technological development in inequality? What was your initial view on technological development, and how did it evolve into the current stance that "the current path of artificial intelligence development is neither economically nor democratically beneficial"?

Acemoglu: Much of my research focuses on the interplay between political economy and technological change, which are two major forces shaping our capabilities and opportunities for growth, as well as influencing our political and economic choices.

AI has become the most important technology of our era, on the one hand, because it has attracted a lot of attention and investment, and on the other hand, because it has made some remarkable progress, especially with the improvement of GPU performance. There is also the pervasive impact of AI. These factors have prompted me to conduct research in this field.

The more I delve into the capabilities and development directions of AI, the more convinced I am that its current trajectory is repeating and exacerbating some of the worst technological mistakes of the past few decades—overemphasizing automation, just as we prioritize automation and other digital technologies without sufficient investment in creating new tasks; and all the mistakes made by social platforms trying to profit from people's data and interests.

I am particularly concerned about the fact that most of the top players in the AI field are driven by unrealistic and dangerous dreams, namely the dream of achieving artificial general intelligence, which places machines and algorithms above humans and is often a way for these top players to dominate others.

Q2: Advanced computer technology and the internet have enabled many wealthy individuals to transfer wealth and made tech giants incredibly powerful. Despite this, we still accept such technological innovation because it also brings positive effects. Technological change has its pros and cons, and historically, society has always found ways to adapt to new technologies. With a new wave of technology sweeping in, why do you think the issue of inequality is particularly worrying?

Acemoglu: When it comes to social platforms and artificial intelligence, I agree with the above statement, but the situation with the internet is different, and I have a different opinion. I believe the internet has been misused in some ways, of course, I do not deny that the internet is a very beneficial technology, playing a very important role in connecting people, providing information to people, and creating new services and platforms.

For artificial intelligence, I am very worried that it will become a way to transfer wealth and power from ordinary people to a small group of tech entrepreneurs. The problem is that we do not have any necessary control mechanisms to ensure that ordinary people benefit from AI, such as strong regulation, worker participation, civil society, and democratic oversight. The "inequality" we see is the "canary in the coal mine," indicating that worse things are to come.

Q3: You pointed out that the inequality caused by automation is a "result of how enterprises and society choose to use technology." As the market power and influence of tech giants grow and may even become uncontrollable, what is the key to our response? If you were the CEO of a large technology company, how would you use AI to manage this company?Acemoglu: My advice to CEOs is to realize that their greatest asset is their workers. Instead of focusing solely on cutting costs, they should seek ways to enhance the productivity, capabilities, and influence of their workers. This means using new technologies to create new tasks for workers and to develop new capabilities.

Automation is beneficial, and we will undoubtedly use it more in the future, but it is not the only thing that can be done to increase productivity, nor should it be the only thing CEOs pursue and prioritize.

Q4: U.S. antitrust enforcers have publicly expressed a series of concerns about artificial intelligence. It is said that the Department of Justice and the Federal Trade Commission have reached an agreement that paves the way for antitrust investigations into Microsoft, OpenAI, and NVIDIA. Can such antitrust actions against large technology companies truly increase market competition and prevent AI development from being dominated by a few companies?

Acemoglu: Absolutely, antitrust enforcement is crucial. The root of some problems in the tech industry lies in the lack of antitrust enforcement in the United States. The five major technology companies have established a solid monopoly position in their respective fields because they have been able to acquire potential competitors without any regulation. In some cases, to consolidate their monopoly position, they have purchased and discontinued technologies that could have competed with them. We absolutely need antitrust to break the political power of large technology companies, which has become very strong over the past thirty years.

But I also want to emphasize that antitrust alone is not enough; we need to redirect technology towards directions that are beneficial to society. Simply splitting Meta into Facebook, Instagram, and WhatsApp will not achieve the goal of increasing market competition and preventing AI development from being dominated by a few companies. In the field of AI, if there are concerns about AI technology being used for manipulation, surveillance, or other malicious purposes, antitrust alone will not be the solution. Antitrust must be combined with a broader regulatory agenda.

Technology and People: How to Avoid Repeating the Same Mistakes

Q5: You have always emphasized "machine usefulness," which means "trying to make machines more beneficial to humans." How do you think this goal can be achieved? What are the consequences if this goal is not achieved?

Acemoglu: This is related to the advice given to CEOs above. What we want are machines that can expand human capabilities. In terms of AI, there is a great possibility of achieving this. AI is an information technology, so we should consider what kind of AI tools can provide useful, context-dependent, real-time information for human decision-makers, and what AI tools can make humans better problem solvers and enable them to perform more complex tasks. This is not only for creative workers, scholars, or journalists but also for blue-collar workers, electricians, plumbers, healthcare workers, and all other professions. Better access to information can drive wiser decision-making and the execution of higher-level tasks, which is the meaning of machine usefulness.

Q6: You suggest giving fair tax treatment to workers' labor. Is it a practical solution to tax equipment and software like human employees or to reform taxes to encourage employment rather than automation?

Acemoglu: Yes, Simon Johnson and I jointly proposed in "Power and Progress" that a fairer tax system can be part of the solution. In the United States, the marginal tax rate faced by businesses when hiring labor is over 30%. When they use computer equipment or other machinery to perform the same tasks, the tax rate is less than 5%, which provides excessive incentives for automation while hindering employment and investment in training and human capital. Unifying the marginal tax rates for capital and labor to the same level is a reasonable policy idea.Q7: You propose tax reform to reward employment rather than automation. How would such reform affect the application and investment in automation technology by businesses?

Acemoglu: There must be caution in this regard not to discourage investment, especially as many countries need rapid growth and require new investments in areas such as renewable energy and healthcare technologies. However, if we can encourage technology to develop in the right way, it can also be beneficial for businesses. Thus, my proposal is to eliminate the excessive incentives for automation and hope that it can be achieved in a way that does not generally discourage business investment.

Q8: The rapid development of social platforms has brought some negative impacts, such as information bubbles and the spread of misinformation. How do you think we can avoid repeating the same mistakes in the further development of artificial intelligence?

Acemoglu: There are three principles that can help avoid repeating the same mistakes: (1) Prioritize the usefulness of machines, as I advocate; (2) Empower workers and citizens, rather than trying to manipulate them; (3) Introduce a better regulatory framework to hold technology companies accountable.

Technology and Industry:

Digital advertising tax makes the industry more competitive

Q9: Technology expert Jaron Lanier emphasizes the issue of data ownership by internet users. How do you think personal data ownership and control should be better protected in policy?

Acemoglu: I believe this is an important direction. First, we will need more and more high-quality data, and the best way to produce this data is by rewarding those who create high-quality data, which data markets can achieve. Second, data is currently being plundered by technology companies, which is unfair and inefficient.

However, the key is that data markets are not like fruit markets; my data can often be highly substitutable for your data. So if technology companies can negotiate with individuals to buy their data, there will be a "race to the bottom," and the administrative costs of doing so would be very high. Therefore, I believe that a well-functioning data market requires some form of collective data ownership, which could be data unions or data industry associations, or other forms of collective organizations.

Q10: What is your view on introducing a digital advertising tax to limit the profit from misinformation driven by algorithms? What impact might such a tax policy have on the digital advertising industry and the dissemination of information?Acemoglu: I support a digital advertising tax because business models based on digital advertising are highly manipulative and synergistic with strategies that create emotional anger, digital addiction, extreme envy, and information cocoons. They can also be synergistic with business models that exploit personal data, leading to negative consequences such as mental health issues, social polarization, and a reduction in democratic citizenship.

What's worse, if we were to reorient the development of AI as I suggest, we would need to introduce new business models and new platforms, but the current business models based on digital advertising make it impossible. You can't launch a new social platform based on user subscriptions, you can't replicate the success of Wikipedia, because you're against companies that offer free services and have a large customer base. So, I see the digital advertising tax as a way to make the tech industry more competitive: if the "low-level" methods of acquiring user data and profiting from digital advertising can be curbed, new business models and more diverse products will emerge.

Q11: Can you share some of the positive changes you think future technological developments might bring, and how we should prepare for and promote these changes?

Acemoglu: If we use artificial intelligence correctly, it can improve the professional skills of workers in all industries and also improve the process of scientific discovery. I also believe there are ways to use AI democratically.