The Collapse of Scarcity Economics
Wulf A. Kaal · 2026
Traditional economic frameworks assume scarcity-constrained equilibrium, wherein capital, labor, and resources interact within finite boundaries. Artificial intelligence and robotics introduce production functions that decouple growth from labor constraints, thus fundamentally challenging this foundational assumption. Building on the author’s prior work, this Article argues that the convergence of AI-driven automation, zero-marginal-cost production, and exponential scaling renders obsolete not merely individual occupations but the institutional architectures that depend upon scarcity as an organizing principle. The Article systematically demonstrates how the core propositions of neoclassical, behavioral, information-theoretic, general-equilibrium, and New Institutional economics expire in the face of computational abundance. It develops a theoretical framework for understanding abundance as a structural economic condition and proposes that the emerging economy requires governance mechanisms designed for what the author has elsewhere termed Computative Economics—economic science explicitly designed for a world in which intelligence is abundant, perfect, and self-improving. Keywords: artificial intelligence; post-scarcity economics; abundance economics; zero marginal cost; Coasean Singularity; Agentic Decoupling; Computative Economics; decentralized autonomous organizations; blockchain governance; reputation systems; dynamic regulation; agency costs; corporate governance; tokenomics; labor displacement; GDP measurement; institutional obsolescence; principal-agent theory; neoclassical economics; bounded rationality; information economics; general equilibrium; New Institutional Economics JEL Classification: O33, O38, O43, P16, E58, G34, K20, K23, J23, E01, D21, D23, D47, D50, D86, L14, B13, B21, B25, B52 1 Professor of Law, University of St. Thomas School of Law (Minneapolis). The author is grateful for enlightening correspondence with Mark Lemley whose outstanding scho
Cite: Wulf A. Kaal, The Collapse of Scarcity Economics (2026). SSRN: https://ssrn.com/abstract=6421319
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