The Fourth Industrial Revolution, also known as the Automation Revolution, is upon us. The world is on the cusp of a significant shift in how we live, work and play. With technological advancements such as artificial intelligence, the internet of things, and robotics, we will see low-skilled and specialist jobs fading into obscurity. Policymakers need to consider the impact these changes will have on society and the economy and take proactive steps to ensure that the benefits of the new industrial revolution are widely shared. Some examples to help resolve the imbalance would be to adopt Universal Basic Income (UBI), a robot tax, and a finite resource tax.
Universal Basic Income is a policy proposal that provides a guaranteed income to all citizens, regardless of their employment status. The proposal, if adopted, would ensure that the benefits of the industrial revolution are widely shared rather than concentrated in the hands of a few individuals. Those left behind because of the transition to automation would benefit from the safety net that UBI would provide.
Eventually, robots and automation will replace many jobs that are currently carried out by humans as artificial intelligence becomes more prevalent in the workforce. There is an ongoing debate about whether automation will replace more jobs than it will create. Automation could lead to increased unemployment and poverty, particularly for those who lack the skills or education to adapt to the changing job market. UBI would provide a basic income level for everyone, ensuring everyone has the means to meet their basic needs. The introduction of UBI should be a way to simplify many countries’ tax and benefits systems.
A robot tax is a proposal to tax companies that use robots and automation to compensate for the loss of jobs caused by industrialisation. The idea behind a robot tax is to create a revenue stream that would help fund retraining programs and other measures to help workers adapt to the changing job market, while incentivising companies to invest in human workers rather than rely solely on automation.
Some economists believe a robot tax would deter the broad adoption of automation across businesses, as the tax would make it more expensive to transition to less labour-intensive ways of production and service provision. However, if a robot tax is gradually phased in post-automation adoption, and with the declining costs of mechanisation tools over time, the ability to tax robots should be good for business.
A finite resource tax is a proposal to tax the use of limited resources, such as fossil fuels, to encourage conservation and sustainability. The idea behind the finite resource tax is to internalise the costs of using finite resources so that they are reflected in the prices of goods and services. Such a tax would incentivise companies to invest in renewable energy and other sustainable technologies and generate revenue that would fund other measures to promote sustainability.
As automation and artificial intelligence become more prevalent in the workforce, it’s crucial to ensure that the benefits of the Fourth Industrial Revolution are widely shared rather than concentrated in the hands of a small number of companies and individuals. By adopting UBI, the robot tax, and the finite resource tax, society can help ensure that the transition is fair and inclusive.
