Three Observations

AI progress follows three economic observations: model intelligence scales roughly with the log of resources spent on training and running it, the cost of a given level of AI falls about 10x every 12 months, and the socioeconomic value of linearly increasing intelligence is super-exponential. Token prices fell about 150x from GPT-4 in early 2023 to GPT-4o in mid-2024, a faster pace than Moore's law's doubling every 18 months. It expects AI agents to become virtual co-workers, starting with a software engineering agent, and says the impact of AGI will be uneven.