David’s argument is a threshold one, not a lag one—factories didn’t gradually accrue the unit-drive benefit as intangible investment built up, they got nothing until the old power system fully depreciated and the whole building was rebuilt around it. Footnote 7 borrows him for the smooth J-curve story, but David’s case argues against smoothness: below threshold, flat; above it, a jump. We need to ask what AI’s equivalent threshold is, rather than what its curve looks like.
Is the chart with labor productivity showing log labor productivity? If not, then you should use an exponential trend line.
David’s argument is a threshold one, not a lag one—factories didn’t gradually accrue the unit-drive benefit as intangible investment built up, they got nothing until the old power system fully depreciated and the whole building was rebuilt around it. Footnote 7 borrows him for the smooth J-curve story, but David’s case argues against smoothness: below threshold, flat; above it, a jump. We need to ask what AI’s equivalent threshold is, rather than what its curve looks like.
“Past GPT-driven productivity booms have raised annual productivity growth by 1 to 1.5 percent for a decade or two.”
This is clearly a “typo”, since there hav been zero GPT-driven productivity booms in the past.