The Productivity Paradox: A.I. and Economic Growth

Despite the rapid advancements in technology, many industrialized nations are facing an economic growth slump, with O.E.C.D. countries projected to grow by just 1.7 percent this year. This puzzling scenario is often referred to as the productivity paradox.

Debates on A.I.’s Impact: Economists are divided on the potential of artificial intelligence to boost productivity. Daron Acemoglu, an M.I.T. labor economist, recently stirred controversy with his findings that A.I. may only lead to “modest” improvements in worker productivity, contributing no more than 1 percent to the U.S. economic output in the next decade. In contrast, Goldman Sachs economists forecasted a 7 percent increase in global G.D.P. due to generative A.I.

The Optimistic View: Some industry leaders, like Sam Altman of OpenAI and Jensen Huang of Nvidia, are bullish on A.I.’s transformative power, envisioning it as a solution to poverty and heralding it as the driver of the next industrial revolution.

A.I.’s Limits: Acemoglu cautions that A.I. may not be the panacea for economic stagnation. He notes that A.I. can only automate around 5 percent of tasks performed by office workers, and believes that the current hype surrounding A.I. may be unwarranted in terms of its potential to significantly boost productivity.