The simulation suggests that “technological progress can be immiserating” and that even talented software programmers may face tough times in an ever more automated economy. The reason lies in the durability and reusability of software. Code is not used up; it accumulates. As the cost of deploying software for productive work (ie, the cost of automation) goes down, demand for new code spikes, bringing lots of new programmers into the labor market. The generous compensation provided to the programmers leads at first to higher savings and capital formation, fueling the boom. But “over time,” the model reveals, “as the stock of legacy code grows, the demand for new code, and thus for high-tech workers, falls.”

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