A Thought Experiment Envisioning A “Fully Automated Society”
In a world where human labor has become unnecessary because of AI, what should be the focus of the study of economics? In the future, if AI and robots have become capable of producing all goods and services necessary for our society, what kind of economic problems could remain?
Of course, a fully automated society is not prediction for the near future. This article imagines such an extreme type of society as a thought experiment designed to consider economic systems in the age of AI. Here, a fully automated society refers not only to one in which corporate production is automated, but also to one in which the legislative, administrative, and judicial functions of government are substantially supported—and in some cases automated—by AI.
I started thinking about this matter when I heard from a researcher acquaintance that a paper concerning AI’s impact on employment had caused quite a stir on X, and I decided to read it out of curiosity. The paper discussed the possibility that AI-driven job cuts could reduce workers’ incomes, weaken consumer demand, and ultimately backfire on firms themselves (Falk and Tsoukalas 2026). Companies may earn higher profits in the short term by taking advantage of AI to cut back on personnel costs. However, if most companies follow that same approach, overall market demand would weaken because workers are also consumers.
The purpose of this article is not to question the validity of that paper’s argument. Rather, the focus is on what economic problems would remain in a future society if AI not only partially replaces human labor but also produces most goods and services.
Scarcity Will Continue to Be a Problem
There has already been extensive research regarding the impact of AI on employment. For example, Acemoğlu and Restrepo (2019) argued that while automation may replace existing human jobs, it may also create new ones. Moreover, the possibility that technological advances could free humans from labor and greatly alleviate economic problems was discussed long ago by Keynes (1930).
If AI and robots become capable of producing goods and services on a sufficiently large scale, would economic problems disappear? That would not necessarily be the case. Even in a fully automated society, scarce resources such as land, location, natural environments, energy, and rare metals will remain limited. Moreover, social status, influence, and political decision-making power are deeply connected to human intentions and perception, and cannot simply be delegated to AI. More land will not become available simply because more people wish to live in convenient urban locations. Quiet natural environments, advanced healthcare resources, social attention, and political influence also cannot be maximized for everyone at the same time.
Therefore, even in a fully automated society, some economic problems will remain. However, the main focus will shift from the “problem of insufficient ordinary commodities” to “how to allocate fundamentally scarce resources.” As production capacity increases, the value of true scarcity only becomes clearer.
In that case, the roles of markets and prices will still exist. Prices are not merely figures that allow for corporate earnings; they convey information about which resources are scarce and to what extent, how much demand there is for those resources, and what supply constraints there are. That perspective connects to a classic argument made by Hayek (1945), who argued that prices function as a mechanism through which dispersed information can be aggregated.
However, if AI becomes deeply integrated into the market, the concept of price itself may change. At present, prices serve as one-dimensional signals representing the levels of various factors, such as scarcity, quality, demand, supply, environmental impact, and future risks, expressed in terms of a single metric, that is, monetary value. If AI agents become capable of processing large volumes of information on behalf of consumers and companies, it is possible that multi-dimensional market signals that convey information concerning all those various factors, including quality, environmental impact, congestion, delivery time, reliability and social impact may come into use. Narita (2025) also discussed the possibility that the roles of money and prices may change, with more diverse evaluation standards becoming involved in economic coordination.
For People to Enjoy Affluence
In a fully automated society, how people participate in the market and society will become more important than ever. If the premise that people earn income through labor becomes obsolete, it will be necessary to develop a mechanism whereby purchasing power is distributed to everyone. In this context, universal basic income (UBI) may be reframed not only as relief for the unemployed, but as a form of fundamental purchasing power used by people to express their preferences. Managi (2025) also pointed out that governance over the equitable distribution of the benefits of AI is essential.
Moreover, UBI may not be limited to simple monetary payments. In the future, UBI may take the form of a system combining other benefits as well, including energy use quotas, rights of access to basic healthcare services and education, and rights to refuse or control the use of personal data. In a fully automated society, UBI would therefore be a matter not only of how much to provide, but also of what kinds of access to guarantee and over what time horizon.
Another important issue is whether it is appropriate to treat people merely as consumers. In a fully automated society, the need for people to work for a living may diminish. However, even without such a necessity, humans will likely still possess the desire to create or to be creative. It is human nature to try new things and to try to surprise or impress other people. The spirit of fun and curiosity, a desire for self-expression, an inquisitive mind, and an appetite for challenges are deeply and fundamentally connected to human nature. Therefore, when designing a future UBI system, it will be important to treat people not merely as consumers but as agents who can participate in creation and exploration.
Additionally, the question of who owns and controls AI systems, robots, foundation models, and computing infrastructure is also a major issue. Even if a certain level of income is distributed to everyone, there may remain a power gap between those who control AI systems and robots and those who merely have access to them, in place of the income gap that currently exists in society.
All of the above-mentioned points for debate are relevant to the study of economics. How scarce resources should be allocated, how to guarantee people’s range of choices, and how to design ownership and controlling rights are problems central to economics. A fully automated society is not a near-future prediction. However, this extreme thought experiment serves as a useful guide for considering economic systems in the age of AI. Economics in the age of AI is not about discarding the intellectual legacy of economics, but about inheriting it and extending it toward a new society.
June 12, 2026
>> Original text in Japanese
