AI and Jobs: the role of demand

James Bessen

No 24235, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Artificial intelligence (AI) technologies will automate many jobs, but the effect on employment is not obvious. In manufacturing, technology has sharply reduced jobs in recent decades. But before that, for over a century, employment grew, even in industries experiencing rapid technological change. What changed? Demand was highly elastic at first and then became inelastic. The effect of artificial intelligence on jobs will similarly depend critically on the nature of demand. This paper presents a simple model of demand that accurately predicts the rise and fall of employment in the textile, steel and automotive industries. This model provides a useful framework for exploring how AI is likely to affect jobs over the next 10 or 20 years.

JEL-codes: J2 N10 O3 (search for similar items in EconPapers)
Date: 2018-01
New Economics Papers: this item is included in nep-his, nep-lma, nep-ore and nep-tid
Note: PR
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Citations: View citations in EconPapers (41)

Published as Artificial Intelligence and Jobs: The Role of Demand , James Bessen. in The Economics of Artificial Intelligence: An Agenda , Agrawal, Gans, and Goldfarb. 2019

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