CARL BENEDIKT FREY
Investors remain exuberant about AI, betting that the opportunities will outweigh the risks. But discerning the scale of each in different economic sectors and jurisdictions is a complex undertaking, which must account for a wide range of factors, including financial markets, demographic trends, regulatory policy, democratic accountability, and natural-resource constraints.
As Oxford’s Carl Benedikt Frey notes, while today’s AI investments “could well pay off like the internet did,” the gains currently “look more muted,” with larger “macro downsides,” than in the case of the dot-com bubble of the late 1990s. Unless AI “delivers broad and sustained productivity gains quickly” – thereby easing fiscal pressure, lowering debt ratios, and buttressing financing structures – the “payoff might not compensate for the massive front-loaded costs.”
Then there are the costs to people’s livelihoods, points out UCL Policy Lab’s Noreena Hertz – particularly those of women. In fact, the latest wave of automation is likely to have a disproportionate impact on female workers, who are already at an “economic disadvantage relative to men.” Ensuring that “women don’t bear the brunt of AI-induced job displacement” will require policy intervention, particularly to ensure that they are “offered equal opportunities for access and upskilling.”
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