You making a distinction between labor and capital which does not exist. Contemporary economists view both labor and capital as inputs to production. If Input A and Input B are substitutes, then producers will choose the cheaper one.
I've never heard of any well-known economist arguing labor and capital are the same; got any reference? While labor and capital are indeed factors of production, they are quite distinct. Capital is the accretion of past labor and serves to augment the effects of the current.
If and when the robot dream is finally realized, it would be novel insofar as it involves the unprecedented production of laborers through an economic process. The debate over the effects of bringing new workers into the economy has, however, been played out many times. (E.g. regarding cheap robots for unskilled work cf. Chinese immigration in the 19th century.)
I've never heard of any well-known economist arguing labor and capital are the same; got any reference?
I'm not sure why you ask me for a reference for a claim I didn't make. I claimed that labor and capital are substitutes as inputs to production. I also claimed that an inferior or more expensive substitute may go unused when a better alternative becomes available.
