Simulating the Global Effect of Transformative AI: Growth, Welfare, Economic Power, and Policy Responses

Authors

Seth Gordon Benzell, Chapman UniversityFollow
Victor Yifan Ye, Stanford Digital Economy Lab

Document Type

Article

Publication Date

3-2024

Abstract

"The development of AI technologies and their economic impact are highly uncertain. Some, though, predict the imminent, ubiquitous deployment of powerful technologies that automate human labor in a variety of fields. Whatever the likelihood of this outcome, it is crucial to start preparing for this possibility immediately. Scenario analysis, even if the relative likelihood of scenarios remains unknown, is possible and wise.

To quantitatively assess the impact of advanced AI, we¹ developed a large-scale, multi-region computable general equilibrium, overlapping generations (OLG) model of the global economy focused on the international, distributional, and government fiscal impacts of new technologies. This model allows us to simulate different technological and policy scenarios, and see how they connect to political and economic goals.

For additional details, our Stanford Digital Economy Lab working paper, Simulating Endogenous Global Automation, is the most complete summary of our model.²"

Recommended Citation

Benzell, S. G., & Ye, V. Y. (2024, Mar.). Simulating the global effect of transformative AI: Growth, welfare, economic power, and policy responses. https://digitaleconomy.stanford.edu/publications/simulating-the-global-effect-of-transformative-ai-growth-welfare-economic-power-and-policy-responses/