For years now, Google’s CEO, Sundar Pichai, has been saying that artificial intelligence will have a more profound effect on humanity than the internet, electricity, or even fire. But in November 2022, that potential became a global sensation after the American AI-research laboratory OpenAI publicly launched ChatGPT—an application that can answer questions, engage in conversation, and write whole articles or books in any voice or style.

Since then, the use of AI has spread considerably: Today, there are nearly 500 AI-generated news and information websites, in at least 14 languages; music-streaming platforms are teeming with songs composed by AI; and Amazon offers thousands of AI-authored books. The tech giants Google, Meta, Microsoft, and IBM have announced their plans to release new artificial-intelligence systems. All of which has been accompanied by forecasts of massive employment dislocations and a transformation of the global economy.

Yet the performance of the AI chatbots that have generated to much excitement about the technology is still uneven, sometimes generating wrong answers or citing nonexistent sources. Traffic to the ChatGPT website fell by about 10 percent in June; downloads of its iPhone app have also declined. And a recent survey found that only 18 percent of U.S. adults had ever used ChatGPT at all. So how much economic impact is AI really having?

Daron Acemoglu is a professor of economics at MIT and a co-author of the recent book Power and Progress: Our 1,000-Year Struggle Over Technology and Prosperity. So far, according to Acemoglu, artificial intelligence has had only a minimal effect on the economy, both in the U.S. and globally. And companies that have adopted it are using it mostly for automation and surveillance. On its current path, the technology’s development has been limited by Big Tech companies’ dominant business model—which depends on creating maximum hype around new products that don’t necessarily have a lot of long-term value—along with a vision of artificial intelligence, dominant in popular culture and the tech industry alike, that sees the ultimate purpose of AI as supplanting human workers and creators.

Ultimately though, Acemoglu believes that AI holds tremendous potential for humanity. But that potential won’t be realized by the technology itself; it will be realized by us shaping it to do what we want it to do.

Michael Bluhm: Where is artificial intelligence most affecting the U.S. economy now?

Bence Balla-Schottner

Daron Acemoglu: A lot of what we’ve heard about AI’s transformative effect on the economy is hype, but it’s true that we’re at an inflection point, with generative AI specifically—artificial intelligence programmed to produce text, images, and other media.

This article is for members only

Join to read on and have access to The Signal‘s full library.

Join now Already have an account? Sign in