Page - (000047) - in Disrupted Development and the Future of Inequality in the Age of Automation

4 TECHNOLOGICAL TRANSFORMATION 39 which today’s HICs used to have (Frey, Osborne, & Holmes, 2016). Beyond the perceived threat of “technological unemployment,” there are broader questions to be asked about how automation and digitiza- tion influence economic development, employment growth, and struc- tural transformation in developing countries. It may well be that labor displacement is less of an issue than real-wage growth as a result of the potential for automation, for example. 4.2 AutomAtion: definitions And determinAnts The concept of automation is more difficult to define than might seem at first glance. Throughout history, humans have used tools to save time and effort when completing laborious tasks and thanks to innovation, such tools have gradually increased in sophistication. Today, the spec- trum of “physical capital” ranges from simple manual tools to intelli- gent machines. One could thus argue that a “robot” is simply a highly advanced version of a tool which requires minimal (manual) human input for completing a task, although currently all machines still require considerable human intervention in their design, production, installa- tion, and maintenance. The potential of AI is to move machines beyond human oversight, at least in everyday operation. An intelligent machine performs a set of complex tasks autonomously and may be capable of adapting to new and changing circumstances, i.e. “learning.” Workhorse animals could be considered a biological equivalent of complex machines and have been used in transportation and agriculture since at least the agricultural revolution in 10,000 BC. Contemporary automation often tends to be associated with physical hardware such as industrial robots, but also includes software which plays a critical role in service automa- tion (see Lacity & Willcocks, 2018; Willcocks & Lacity, 2016). The wider process of structural economic change toward an automated econ- omy has been referred to not only as a digital transformation but as the “fourth industrial revolution” (Schwab, 2016). Under what conditions might such a transformation or revolution take place? Technological feasibility is just one condition. Table 4.1 shows multiple criteria which the decision to automate involves: can a task be automated in a way that reliably produces a good or service at a spec- ified level of quality? Is it profitable to automate that task? Is it legally possible for a firm to replace workers with machines? How do relevant stakeholders such as political groupings, particularly trade unions, and