But will the Minister then draw the right conclusion?

As Paul Krugman pointed out productivity isn’t everything. But in the long run it’s almost everything. For the income that can be gained, consumption that is enabled, from an hour of human labour is clearly not just limited but defined by the output from an hour of human labour. Thus, if we desire to increase consumption, which is by definition an increase in incomes, we need to increase the productivity of labour.

As William Baumol has also pointed out increasing productivity in services is difficult. Largely on the grounds that a service is, roughly enough, the time of a person. But it’s necessary to recall that it’s only “more difficult”, not impossible. Technological advance can indeed reduce the amount of human time, labour, required to produce a service. By, obviously enough, turning it into a manufacture - something done by machines perhaps - and thus improving the productivity of human labour that way.

Ms. Phillipson asks the right question:

AI tools will soon be in use in classrooms across England, but the education secretary, Bridget Phillipson, has one big question she wants answered: will they save time?

Attending a Department for Education-sponsored hackathon in central London last week, Phillipson listened as developers explained how their tools could compile pupil reports, improve writing samples and even assess the quality of soldering done by trainee electrical engineers.

After listening to one developer extol their AI writing analysis tool as “superhuman”, able to aggregate all the writing a pupil had ever done, Phillipson asked bluntly: “Do you know how much time it will have saved?”

But will she then draw the correct conclusion? If time is saved but we continue to have the same number of teachers producing the same amount of education then productivity hasn’t increased. We’ve the same labour input, the same output.

If time is saved and we react by having fewer teachers then productivity has increased and we’ve all got richer. That newly freed up labour can go off and contribute to saying some other human need and we are able to consume that new production, our incomes are higher by the value placed upon it.

So, AI saves teachers time, that’s good. But it’s only good for all of us - as opposed to just for teachers who now have more time - if we react by having fewer teachers. Which is the big question.

Will the Minister draw the right conclusion, that AI means fewer teachers?

To even ask that question that way is to answer it, isn’t it.

Tim Worstall