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Economists Reassess Automation’s Impact
Artificial intelligence (AI) is reshaping economists’ views on technology and labour. Historically, economists believed technological advancements would ultimately benefit labour markets, increasing productivity and enabling workers to move into new fields. However, as AI technologies proliferate, this optimism is waning. Recent studies reveal that AI may exacerbate inequality by displacing middle-wage jobs and benefiting high-skilled workers, prompting economists like MIT’s Daron Acemoglu and Boston University’s Pascual Restrepo to revise their models. They now emphasise the potential for technology to reduce wages for all workers if it merely automates existing tasks without creating new opportunities.
Task-Based Models and Labor Market Evolution
Newer economic models break down work into individual tasks, distinguishing between automation of existing work and creation of new job categories. These task-based models clarify how technology impacts different job sectors and highlight the importance of new task creation in maintaining economic balance. For example, digital technology has largely automated clerical work while enhancing roles requiring higher skills. Research by MIT economist David Autor shows that over 60% of employment in 2018 was in job titles that didn’t exist in 1940, underscoring the dynamic nature of labour markets and the critical need for continuous innovation.
Inclusivity in Technological Decision-Making
The integration of AI in the workforce underscores the importance of inclusive decision-making involving workers. Economists now advocate for policies that support the creation of new work and incorporate worker input to guide AI’s development in ways that enhance productivity and job satisfaction. Unions, for example, can play a pivotal role in ensuring workers benefit from technological advancements. The shift in economic thinking recognizes that for AI to contribute to widely-shared prosperity, it must create new opportunities for human expertise and involve workers in its deployment decisions.
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