You've expressed very clearly what LLMs would have to do in order to be economically transformative.
"If you can get high quality medical advice for effectively nothing, if you can get high quality individualized tutoring for free, that's a pretty big game changer for a lot of people. Prices on these services have been rising to the stratosphere over the past few decades because it's so difficult to increase the productivity of individual medical practitioners and educators. We're entering an era that could finally break this logjam."
It's not that process innovations are lacking, it's that product innovations are perceived as an indignity by most people. Why should one child get an LLM teacher or doctor while others get individualized attention by a skilled human being?
Is the value in the outcome of receiving medical advice and care, and becoming educated, or is the value just in the co-opting of another human being's attention?
If the value is in the outcome, the means to achieving that aren't of much consequence.
If AI displaces human educators, yes, their supply shrinks -- but we can't assume what direction its demand will go.
We've seen this pattern before: as recorded music became free, live performance got more expensive, and therefore much less accessible than it used to be.
What's likely to happen is that "worse" (read: AI) education will become much cheaper, while "better" (read: in-person) education that involves human connection-driven benefits will become much less accessible compared to what it is today.
Most people may be consider it a win. It's certainly not a world I'm looking forward to.
How many of us have a reminiscence that starts “looking back, the most life-changing part of my primary or secondary education was ________,” where the blank is a person, not a curriculum module? How many doctors operate, at least in part, on hunches—on totalities of perception-filtered-through-experience that they can’t fully put into words?
I’m reminded of the recent account of homebound elderly Japanese people relying on the Yakult delivery lady partly for tiny yoghurt drinks, but mainly for a glimmer of human contact [0]. Although I guess that cuts to your point: the value in that example really is just co-opting another human’s attention.
In most of these caring professions, some of the value is in the measurable outcome (bacterial infection? Antibiotic!), but different means really do create different collections of value that don’t fully overlap (fine, I’ll actually lay off the wine because the doctor put the fear of the lord in me).
I guess the optimistic case is, with the rote mechanical aspects automated away, maybe humans have more time to give each other the residual human element…
But Baumol's argument, which you introduced to the conversation, is that outcome and process cannot actually be distinguished, even if a distinction in thought is possible among economic theorists.
For education, if you know as much as the average Harvard grad, can you give yourself a Harvard degree that will be as readily accepted in a job application or raising funds for a new business?
Thats a weird way of describing it.
A machine telling me to exercise and eat right will be ignored, even if the advice is correct. A person I trust taking me aside, looking me in the eye and asking me the same would be taken far more seriously.
OTOH, if you don't need to be persuaded and just want information on how best to go about doing it, then I think it makes little difference where the information comes from as long as it's of reasonable quality.
There's also the deeper philosophical question of what is the meaning of life, and if there's inherent value in learning outside of what remunerative advantages you reap from it.
You already can get a good-quality medical advice "for nothing", unless it requires e.g. a blood test. The question is, how actionable such an advice is going to be, and how even the quality is going to be.
By selling those services at a cost of “free”, hyperscalers eliminate competition by forcing market entrants to compete against a unit price of 0. They have to have a secondary business to subsidize the losses from servicing the “free” users, which of course is usually targeted advertising to capitalize on the resources paid by users for access. Or simply selling to data brokers.
With the importance of training data and network effects, “free” services even further concentrate market power. Everyone talks about how AI is going to take away jobs, but no one wants to confront how badly the anticompetitive practices in big tech are hurting the economy. Less competition means less opportunity for everyone else, regardless of consumer benefit.
The only way it works if the “free” service for tutoring or healthcare is through government subsidies or an actual non-profit. Otherwise it’s just going to concentrate market power with the megacorps.
In aggregate, this is true, but there are many ways to game the system to one's advantage and get a true "free lunch." For example, people watching Youtube with an adblocker and logged out don't provide Google with any income or useful telemetry. Likewise you can get practically unlimited GPT/Claude/etc by using multiple accounts.
Look at all the deprecated Google products. What happens when Gemini-SaaS makes billions from licensing to other companies, and Gemini-Charity-for-the-poors starts losing money?
Sadly, the bigger the $$ in the tech pie, the more we have attracted robber barons, etc.