MIT: The Simple Macroeconomics of AI

Summary of https://economics.mit.edu/sites/default/files/2024-04/The%20Simple%20Macroeconomics%20of%20AI.pdf

The paper "The Simple Macroeconomics of AI" by Daron Acemoglu explores the potential economic implications of artificial intelligence (AI), particularly generative AI, on productivity, wages, and inequality.

The paper uses a task-based model to analyze the impact of AI, focusing on automation and task complementarities. Acemoglu finds that AI's macroeconomic consequences are likely to be modest, with a projected 0.55% to 0.71% increase in total factor productivity (TFP) over the next 10 years.

The paper also investigates the potential negative effects of AI-generated "bad" tasks, such as those involving manipulation and misinformation. Acemoglu concludes that while AI's impact on wages and inequality may be less severe than previous automation technologies, it is unlikely to significantly reduce inequality.

The paper emphasizes the importance of harnessing AI for creating new tasks that enhance worker productivity and address the challenges of automation.