The Impact of Artificial Intelligence on Economic Growth: Obstacles and Opportunities

Abstract

This paper aims to analyze the influence of Artificial Intelligence (AI) on economic growth, focusing on productivity, labor market evolution, and long-term development prospects. Previous research highlights AI as a general- purpose technology with the potential of generating significant productivity enchantments, drawing comparisons to previous technological revolutions such as electricity and computing. This paper adopts a literature review methodology, analyzing recent empirical studies and theoretical frameworks that examine the relationship between AI adoption and essential macroeconomic indicators, including GDP growth, employment rates and income inequality. The results show that AI contributes positively to economic growth by making people more productive and encouraging new ideas. But its benefits are not evenly spread out, high-skilled workers and economies that are ahead of the curve in technology get a lot more of them. Policymakers and academics should consider targeted interventions, like investments in education and re-skilling programs, to ensure inclusive growth in the context of increasing AI adoption. This paper adds to the growing body of research on AI and economic development by giving a full picture of the opportunities and challenges that AI brings to modern economies.