Technology and AI—Impact on Country’s Growth and Unemployment

Brij Behari Dave ()

Journal of Banking and Financial Dynamics, 2024, vol. 8, 6-16

Abstract: This study examines the impact of artificial intelligence (AI) adoption on economic growth and unemployment across G7 countries and India. As AI emerges as a transformative technology, there is a need to understand its effects on labour markets and develop appropriate policy frameworks. The research analyses historical patterns of automation and technological change to provide context for the current AI revolution. The study employs a mixed-methods approach, combining quantitative statistical analyses with qualitative assessments. Variables examined include GDP growth rates, R&D investment levels, AI adoption rates, and productivity gains. Descriptive statistics, correlation analyses, regression models, and cluster analyses were conducted to identify relationships between key variables. Results reveal a significant technology adoption gap between high-tech leaders and developing economies. A growth paradox was observed in developing tech economies, where rapid AI adoption did not necessarily translate to proportional economic gains. The research found complex relationships between technological advancement, unemployment rates, and investment levels across countries. Cluster analysis identified three distinct groups: Advanced Economies, Technology Leaders, and Developing Tech Economies. ANOVA and chi-square tests confirmed statistically significant differences between these clusters. Multiple regression analysis on unemployment rates provided insights into the factors influencing job displacement. Key findings include: 1) AI adoption shows potential to significantly boost GDP growth and productivity, though effects vary by country. 2) The relationship between technological progress and unemployment is nuanced, defying simplistic narratives. 3) Investment levels strongly correlate with technological advancement, but other factors also play important roles. 4) Leaders in AI adoption exhibit certain common characteristics, offering potential lessons for other nations.The study concludes that while AI presents substantial opportunities for economic growth, its benefits are not uniformly distributed. Policymakers must develop strategies for inclusive growth, equitable access to technological advancements, and robust safety nets to address potential economic stratification. Future research directions are suggested to further explore the long-term implications of AI on global economies and labour markets. This research contributes to the ongoing dialogue on AI's societal impact and provides evidence-based insights to inform policy decisions in an era of rapid technological change. The findings underscore the need for nuanced, context-specific approaches to AI adoption and regulation across different economic contexts.

Keywords: AI adoption; Economic development; Economic growth; Productivity gains; R&D investment; Technological infrastructure; Unemployment rates (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ecsenet.com/index.php/2576-6821/article/view/236/97 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ajn:jobafd:v:8:y:2024:i::p:6-16:id:236

Access Statistics for this article

More articles in Journal of Banking and Financial Dynamics from Eastern Centre of Science and Education
Bibliographic data for series maintained by Tracy William ( this e-mail address is bad, please contact ).