Automation, artificial intelligence and capital concentration – A race for the machine

Jens Lowitzsch and Renan Magalhães

International Review of Applied Economics, 2025, vol. 39, issue 2-3, 197-215

Abstract: Since the industrial revolution, productive capital in the form of machines, structures and systems has assumed an ever more dominant role as compared to labour. The owners of non-human productive assets receive a growing share of market-sourced income, with an ever-smaller proportion going to the owners of human labour. The shift between factors of production in favour of capital is exacerbated by technological progress and its embodiment in automation. Academic work on labour’s declining income share has emphasised the role of capital accumulation and capital-augmenting technical change exacerbated by the fast developments of artificial intelligence. At the same time, we observe a peculiar disconnect between this phenomenon and public discourse and interpretation of its social and economic effects: the discussion of automation is focused on its potential effects on employment, micro- and macro-distributive effects are barely mentioned.the discussion of rising inequality is focused on issues of distributive justice; the role of the shift from labour to capital in concentrating wealth is mostly ignored.We argue that to offset the disadvantages of AI/automation and further capital concentration, all citizens should be enabled to (co-)own technology and benefit from the second income source capital ownership provides.

Date: 2025
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DOI: 10.1080/02692171.2024.2440078

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