The problem with the "West" going forward is that R&D, design, intellectual property, engineering talent are exactly the areas at most risk of AI disruption leaving the physical grunt work as the only remaining moat
But the economy is in equilibrium which means as this decreases, it's going to change the value of other things, and open the door for new things. Whoever can take what LLMs offer, and then most successfully build on top of that will probably be 'the winner.' I'm not sure exactly what this will translate to in practice, but it seems reasonable to predict that manufacturing is going to be a huge part of it.
"But as the cost of 'cognitive work' in general starts approach $0, the value of such, in and of itself, is also going to approach $0."
When the pirate party was big in EU, there was much talk about copying approaching the cost of 0, and therefor we would never pay for copying data, only creating new data.
I guess this all due to copyright law, and it will not disappear anytime soon, but still. I would not be too quick to draw that same conclusion.
However, we do have Wikipedia. Wikipedia was never valued at the peak sales price of Encyclopedia Britannica times the number of people online, if it was it would be worth around $16 trillion.
Imagine all the work involved in, for instance, trigonometry and its basic applications in the past. And the later on with the advent of kinematics and so forth. These things involved a lot of computation and so there were literal human calculators whose job it was to work out all of the calculations.
But with the advent of electrical calculators, we literally no longer know that these jobs even existed. It's very easy to see the same in a future where, for instance, computer programs can be efficiently written from description alone. At that point the idea of a 'programmer' would seem like quite an odd concept.
I'd also look at what it did to the value of such work. Now computations, even quite complex, are mostly worth exactly $0. But we built extensive systems on top of those computations that became worth quite a lot indeed!