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Moravec's Paradox and Restrepo's Model: Limits of AGI Automation in Growth

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  • Marc Bara

Abstract

This note extends Restrepo (2025)'s model of economic growth under AGI by incorporating Moravec's Paradox -the observation that tasks requiring sensorimotor skills remain computationally expensive relative to cognitive tasks. We partition the task space into cognitive and physical components with differential automation costs, allowing infinite costs for some physical bottlenecks. Our key result shows that when physical tasks constitute economic bottlenecks with sufficiently high (or infinite) computational requirements, the labor share of income converges to a positive constant in the finite-compute regime (rather than zero). This fundamentally alters the distributional implications of AGI while preserving the growth dynamics for cognitive-intensive economies.

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  • Marc Bara, 2025. "Moravec's Paradox and Restrepo's Model: Limits of AGI Automation in Growth," Papers 2509.24466, arXiv.org.
    • Handle: RePEc:arx:papers:2509.24466
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    1. Pascual Restrepo, 2025. "We Won't Be Missed: Work and Growth in the AGI World," NBER Chapters, in: The Economics of Transformative AI, National Bureau of Economic Research, Inc.
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