AI-tocracy

Martin Beraja, Andrew Kao, David Yang and Noam Yuchtman

No 29466, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Can frontier innovation be sustained under autocracy? We argue that innovation and autocracy can be mutually reinforcing when: (i) the new technology bolsters the autocrat’s power; and (ii) the autocrat’s demand for the technology stimulates further innovation in applications beyond those benefiting it directly. We test for such a mutually reinforcing relationship in the context of facial recognition AI in China. To do so, we gather comprehensive data on AI firms and government procurement contracts, as well as on social unrest across China during the last decade. We first show that autocrats benefit from AI: local unrest leads to greater government procurement of facial recognition AI, and increased AI procurement suppresses subsequent unrest. We then show that AI innovation benefits from autocrats’ suppression of unrest: the contracted AI firms innovate more both for the government and commercial markets. Taken together, these results suggest the possibility of sustained AI innovation under the Chinese regime: AI innovation entrenches the regime, and the regime’s investment in AI for political control stimulates further frontier innovation.

JEL-codes: E00 L5 L63 O25 O30 O40 P00 (search for similar items in EconPapers)
Date: 2021-11
New Economics Papers: this item is included in nep-big, nep-cna and nep-tid
Note: DEV POL PR
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Published as Martin Beraja & Andrew Kao & David Y Yang & Noam Yuchtman, 2023. "Ai-Tocracy," The Quarterly Journal of Economics, vol 138(3), pages 1349-1402.

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Related works:
Journal Article: Ai-Tocracy (2023)
Working Paper: AI-tocracy (2021)
Working Paper: AI-tocracy (2021)
Working Paper: AI-tocracy (2021)
Working Paper: AI-tocracy (2021)
Working Paper: AI-tocracy (2021)
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