Unconditional basic income and the post-labor world: On the capitalist road to communism

The thesis of a capitalist road to communism asserts that Marx's realm of freedom can be reached from within welfare capitalism, skipping socialism, by using a tax-financed unconditional basic income until it is close to disposable income per head and the very distinction between paid work and free time is cancelled as a result. We update this thesis for two reasons: the recent prospect of a post-labor world following the automation revolution in technology, and that welfare capitalism has become more inegalitarian and less hospitable to basic income. We use a model with a production function in which automation capital is fully substitutable with labor, and both factors are complementary to fixed capital. A baseline simulation shows the economic feasibility of a capitalist transition to communism. Two versions of a scenario incorporating interplay of labor-saving technical change and egalitarian institutional reforms are set out which can make the transition politically viable to some extent, depending on the social distribution of power over technology. The one in which the productivity coefficients of labor and automation capital grow at similar rates best approximates the ideal of communism.