Artificial intelligence and the skill premium

Bloom David E., Klaus Prettner, Jamel Saadaoui and Mario Veruete

No 353, Department of Economics Working Paper Series from WU Vienna University of Economics and Business

Abstract: What will likely be the effect of the emergence of ChatGPT and other forms of artificial intelligence (AI) on the skill premium? To address this question, we develop a nested constant elasticity of substitution production function that distinguishes between industrial robots and AI. Industrial robots predominantly substitute for low-skill workers, whereas AI mainly helps to perform the tasks of high-skill workers. We show that AI reduces the skill premium as long as it is more substitutable for high-skill workers than low-skill workers are for high-skill workers.

Keywords: Automation; Artificial Intelligence; ChatGPT; Skill Premium; Wages; Productivity (search for similar items in EconPapers)
Date: 2023-12
New Economics Papers: this item is included in nep-cmp and nep-eff
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Related works:
Working Paper: Artificial Intelligence and the Skill Premium (2024)
Working Paper: Artificial Intelligence and the Skill Premium (2024)
Working Paper: Artificial intelligence and the skill premium (2023)
Working Paper: Artificial intelligence and the skill premium (2023)
Working Paper: Artificial intelligence and the skill premium (2023)
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