Economic Growth under Transformative AI

Philip Trammell and Anton Korinek

No 31815, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Recent advances in AI may herald the near arrival of systems that can automate essentially all work. We review the macroeconomic implications of this scenario, in a framework synthesizing several strands of the relevant literature. Robustly, fully automating production alone (so that machines can self-replicate) would dramatically raise the growth rate and lower the labor share, breaking the Kaldor Facts that have long characterized frontier growth. Automating R&D (so that machines can self-improve) would accelerate the transformation, but may not produce it in isolation. Wages—multiplying exploding output and a plummeting labor share—may rise or fall, depending on the returns to scale, the importance of natural resources, and the direction of technical change.

JEL-codes: E2 O3 O4 (search for similar items in EconPapers)
Date: 2023-10
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Working Paper: Economic Growth under Transformative AI (2024)
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