The 2012 publication Race against the Machine makes the case that the digitalization of work activities is proceeding so rapidly as to cause dislocations in the job market beyond anything previously experienced [1]. Unlike past mechanization/automation, which affected lower-skill blue-collar and white-collar work, today's information technology affects workers high in the education and skill distribution. Machines can substitute for brains as well as brawn. On one estimate, about 47% of total US employment is at risk of computerization [2]. If you doubt whether a robot or some other machine equipped with digital intelligence connected to the internet could outdo you or me in our work in the foreseeable future, consider news reports about an IBM program to "create" new food dishes (chefs beware), the battle between anesthesiologists and computer programs/robots that do their job much cheaper, and the coming version of Watson ("twice as powerful as the original") based on computers connected over the internet via IBM's Cloud [3].

Future advances in AI that automate away human labor may have stark implications for labor markets and inequality. This paper proposes a framework to analyze the effects of specific types of AI systems on the labor market, based on how much labor demand they will create versus displace, while taking into account that productivity gains also make society wealthier and thereby contribute to additional labor demand. This analysis enables ethically-minded companies creating or deploying AI systems as well as researchers and policymakers to take into account the effects of their actions on labor markets and inequality, and therefore to steer progress in AI in a direction that advances shared prosperity and an inclusive economic future for all of humanity.

The spread of computers and the internet will put jobs in two categories. People who tell computers what to do, and people who are told by computers what to do. Andreessen has since repudiated this declaration, and taken a more optimistic stance. But economists, a more pessimistic bunch, are taking the possibility of this sort of bifurcated future more seriously. As machine-learning technology enjoys rapid progress, more top researchers are investigating the question of what work will look like in a world filled with computers that can replicate or surpass many of humanity's own mental abilities.

These transformations will open up new opportunities for individuals, the economy, and society, but they have the potential to disrupt the current livelihoods of millions of Americans. Whether AI leads to unemployment and increases in inequality over the long-run depends not only on the technology itself but also on the institutions and policies that are in place. This report examines the expected impact of AI-driven automation on the economy, and describes broad strategies that could increase the benefits of AI and mitigate its costs. Economics of AI-Driven Automation Technological progress is the main driver of growth of GDP per capita, allowing output to increase faster than labor and capital. One of the main ways that technology increases productivity is by decreasing the number of labor hours needed to create a unit of output.

Artificial intelligence (AI) will have profound societal effects. It promises potential benefits (and may also pose risks) in education, defense, business, law and science. In this article we explore how AI is likely to affect employment and the distribution of income. We argue that AI will indeed reduce drastically the need of human toil. We also note that some people fear the automation of work by machines and the resulting of unemployment. Yet, since the majority of us probably would rather use our time for activities other than our present jobs, we ought thus to greet the work-eliminating consequences of AI enthusiastically. The paper discusses two reasons, one economic and one psychological, for this paradoxical apprehension. We conclude with discussion of problems of moving toward the kind of economy that will be enabled by developments in AI.