Trillions of dollars are being poured into the AI promise of a global economic transformation. We're being sold a productivity revolution, faster output, greater growth, and unprecedented prosperity. But when? Real, tangible gains are barely showing up in the data. So is the return on investment actually going to be smaller and slower than promised? And could these billion-dollar bets bankrupt the companies making them and take the global economy down with it? This week, hosts Stephen Horn and Laila Rizvi are talking to globally renowned economist and Director of the Oxford Internet Institute, University of Oxford, Professor Carl Benedikt Frey, co-author of the famous “Future of Employment” study which garnered headlines about robots taking over our jobs and, more recently, his book "The Technology Trap," which showed that revolutionary technologies can take generations to pay off. Laila kicks off the interview by asking Professor Frey if he thinks that the trillions of dollars being invested in AI will pay off in the next five years. The more interesting question, he says, is whether it’s going to pay off for society and the economy. His answer to that one: probably not! He also questions how many of the firms investing enormous resources in the AI race will come out profitable on the other side. Next, Stephen and Carl compare the AI Revolution to the Industrial Revolution. Professor Frey points out that the first Industrial Revolution caused disruption, job loss and decline of wages at the lower end of income distribution, but that the second Industrial Revolution brought us broad-based improvements in standard of living and income. “I think a key question going forward is whether AI will mainly take the form of automation, and more closely mirror the First Industrial Revolution, or whether we will see it develop new products, new industries that create new jobs and activities, that create more broader shared abundance like the Second Industrial Revolution.” So where will innovation come from? Professor Frey points out the decline in breakthrough innovation and breakthrough patents since the computer revolution, which he attributes to an increase of projects, but at a lower quality. Laila asks whether access to AI is leading to more “AI slop” in academic papers, work and essays, while Stephen wonders how companies are actually going to innovate by putting AI at the heart of process. Laila asks Professor Frey what happens to society if AI doesn’t deliver productivity growth soon? Has AI done more harm than good? “Well, AI is clearly a tremendously unpopular technology… It's hard to think of any other technology where the developers of that technology are saying, "Well, best case, this will take your job, but worst case, it's going to kill you." Plus, he says, there’s plenty of hype because the stakes are so high. Stephen turns to the role of governments in the development of AI, and Professor Frey describes approaches that make sense for Europe, China and the USA. When will AI boost productivity and how significant will it be? Professor Frey thinks the answer “depends to what degree we'll see new firms coming in, building new products and new industries around AI” rather than AI merely being used as a productivity tool by individuals, and that “institutional change is going to be needed for these productivity gains to be realized.” As always, we end with our Rapid Fire segment. Laila asks Professor Frey for something that's universally accepted in his field that he strongly disagrees with: “It's seen as almost universally true that the best predictor for the future of work is what machine capabilities are. What's missing in there is that we need to consider more what humans actually want.” Finally, Stephen asks Carl what he’s optimistic about: “I'm really quite optimistic about the potential for AI in medical discovery. I think we do have an extraordinary opportunity for curing many diseases, including, hopefully, cancer.”
