Working Paper: NBER ID: w28453
Authors: Anton Korinek; Joseph E. Stiglitz
Abstract: Progress in artificial intelligence and related forms of automation technologies threatens to reverse the gains that developing countries and emerging markets have experienced from integrating into the world economy over the past half century, aggravating poverty and inequality. The new technologies have the tendency to be labor-saving, resource-saving, and to give rise to winner-takes-all dynamics that advantage developed countries. We analyze the economic forces behind these developments and describe economic policies that would mitigate the adverse effects on developing and emerging economies while leveraging the potential gains from technological advances. We also describe reforms to our global system of economic governance that would share the benefits of AI more widely with developing countries.
Keywords: Artificial Intelligence; Globalization; Economic Development; Inequality; Poverty
JEL Codes: F6; F63; O3; O32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Technological progress (AI) (O33) | Economic outcomes in developing countries (F63) |
| Devaluation of labor and natural resources (F66) | Deteriorating terms of trade (F14) |
| Policy measures (E64) | Economic outcomes for workers in developing countries (F63) |
| Global governance reforms (F53) | Economic stability in developing countries (O54) |
| Technological progress (AI) (O33) | Deteriorating terms of trade (F14) |
| Technological progress (AI) (O33) | Concentration of wealth in developed nations (D31) |