Technological Unemployment and the Resurgence of Political Economy

The aim of this paper is to discuss the possible impact of the “third wave” of technological unemployment on economic theorizing. Twenty-first century technological progress, heavily impacting on employment, is a process that has just started but whose main new feature is already well known. It concerns robots (and artificial intelligence) and their entry into the production process. Robots do not simply increase labor productivity in cooperation with humans but can completely substitute for human labor, making it possible to produce commodities without human input and hence giving rise to mass unemployment which will require some form of public policy intervention. The resulting scenario has important implications for economic theorizing, since mainstream approach faces difficulties in dealing with a reality where social classes and the class struggle (a few robot owners vs. many unemployed humans) regain a role, labor productivity becomes irrelevant and uncorrelated with the (subsistence) wage/subsidy that has to be paid to the unemployed, redistributive policies replace the optimal allocation of scarce means and so on. Such a scenario returns economic theorization to the years of classical Political Economy, when the main focus of theoretical investigation was on social classes, the class struggle and redistribution of the surplus