AI Investment and Economic Growth: Exploring the Divergence of Equilibria

Nobuyasu Suzusho ()
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Nobuyasu Suzusho: Graduate School of Economics,Kyoto University

No 1125, KIER Working Papers from Kyoto University, Institute of Economic Research

Abstract: This paper focuses on the role of strategic complementarity between artificial intelligence (AI) investment and human capital accumulation, analyzing how they interact to shape long-term economic growth. Our model introduces an explicit threshold investment level necessary for viable AI adoption and demonstrates how its existence, along with agents' expectations, generates multiple equilibria. The paper concludes with policy recommendations to lower AI adoption barriers, bolster human capital, and align public and private expectations to foster a sustained, AI-driven growth trajectory.

Keywords: Artificial Intelligence (AI); Economic Growth; Human Capital; Threshold Investment; Multiple Equilibria; Strategic Complementarity (search for similar items in EconPapers)
JEL-codes: J24 O33 O40 O41 (search for similar items in EconPapers)
Pages: 22pages
New Economics Papers: this item is included in nep-ain and nep-gro
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