Economists Wonder If Few or Many Will Benefit from AI

    10 August 2023

    Throughout history, technological progress has brought new wealth but has not always improved people's lives. Economists now say it is not clear whether artificial intelligence (AI) will help or hurt society.

    Simon Johnson teaches economics at the Massachusetts Institute of Technology near Boston. He said AI has a lot of possibilities. But he added, "We are at a fork in the road." A fork in the road is an expression used to describe a situation where the outcome is uncertain.

    FILE - An AI (Artificial Intelligence) sign is seen at the World Artificial Intelligence Conference (WAIC) in Shanghai, China July 6, 2023. (REUTERS/Aly Song/File Photo)
    FILE - An AI (Artificial Intelligence) sign is seen at the World Artificial Intelligence Conference (WAIC) in Shanghai, China July 6, 2023. (REUTERS/Aly Song/File Photo)

    Wealth, jobs and productivity

    McKinsey is a business consulting company. It said AI could add between $14 trillion and $22 trillion of value to the world's economy.

    Supporters say the technology will create wealth and improve living standards. Some go as far as saying AI will increase people's free time and help them be more creative.

    But others are worried the technology will lead to lost jobs. They point to Hollywood writers and actors who are worried that they will be replaced by technology.

    The internet arrived with a similar promise of more productivity, wealth and jobs. Last month, the French bank Natixis noted in its research that most of the wealth has gone to a few billionaires. And many of the jobs do not require highly paid, skilled workers.

    The bank warned in its report, "We should be cautious when estimating the effects of artificial intelligence on labor productivity."

    In July, the Organization for Economic Cooperation and Development released its opinion research of 5,300 workers about AI. Some workers hope the technology will increase pay and job satisfaction. But they are also concerned that the technology could push people to work too hard.

    Lessons from history

    Such concerns are not unfounded. History has shown the economic impact of technological progress is generally uncertain, unequal and even harmful.

    Johnson recently published a book, Power and Progress, with Daron Acemoglu, another economist from MIT. They studied technological progress over the last 1,000 years including clothing production, train travel, and even food shopping.

    The two economists looked at an invention called the spinning jenny that made it easier to turn cotton and wool into yarn. They said the device helped clothing production and created wealth for many people in the late 1700s. However, it also increased the demand for cotton and led to longer hours for workers. The demand also led to the growth of slavery in the southern United States.

    Johnson noted that it is easier to create something new than to make sure it works for everyone. His book shows how the arrival of rail travel improved the lives of many people in England in the 1800s. People were able to travel longer distances and eat fresh food because it could move faster from farms to cities.

    On the other hand, Johnson said self-checkout technology at food stores does not lower the cost or make life easier for people. All it does is reduce the number of workers and help businesses lower labor costs.

    As for AI technology, Johnson wonders if it will make existing inequalities worse, or "could it help us get back to something fairer?"

    I'm Dan Friedell.

    Dan Friedell adapted this story for Learning English based on a report by Reuters.


    Words in This Story

    outcome –n. the result of an event or choice

    consulting –n. a business based on doing research and providing suggestions to another company about how to be more successful

    standards –n. a level of quality

    cautious –n. careful

    yarn –n. fibers of plants or animal hair that a refined and used to make clothing, fabrics or floor coverings

    self-checkout –n. a machine or system at a food store that permits customers to pay for items without help from anyone else