Nobel Laureate Romer Says AI Hype Risks Repeat of Crypto Bubble

(Bloomberg) — Economics professor and Nobel laureate Paul Romer warned that declining trust in artificial intelligence risks repeating the mistakes of the cryptocurrency bubble just two years ago.

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“There’s a lot of confidence right now about the future direction of AI,” Romer told Bloomberg TV at the UBS Asia Investment Conference in Hong Kong on Wednesday. “I think when people project that forward, they run the risk of making a very serious mistake.”

OpenAI triggered a wave of AI excitement with the wildly popular ChatGPT in late 2022; This has led tech giants from Microsoft Corp. to Alibaba Group Holding Ltd. to invest heavily in computing power and cloud capabilities. This turned Nvidia Corp. into a multitrillion-dollar company. -dollar company because its chips are the most effective in managing AI training. But Romer warned that it was dangerous to expect the current rate of improvement in AI services to continue indefinitely.

“We benefited from scaling up the computer and taking in a lot of data,” the former World Bank chief economist said. “It’s pretty easy to scale up computing. Just more machines, more chips. But what’s going to happen is we’re not going to have enough data.”

The most important cautionary tale in Romer’s eyes is the example of autonomous vehicles. Tesla Inc. Companies such as have been promising fully driverless cars for years, but automation systems continue to suffer from reliability issues and end-case scenarios that prevent this promise from being realized.

Romer said that in two years, people will look back at this moment and probably say, “it really was a bubble, we overestimated where it was going.”

–With help from Annabelle Droulers and Haidi Lun.

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