Generative AI, a new general-purpose technology, is expected to accelerate economic progress and bring about significant changes in various industries. (Pexels)AI 

Study finds that Generative AI has the potential to positively impact economies as a versatile technology.

Andrew McAfee, the Co-Founder and Co-Director of ‘MIT’s Initiative on the Digital Economy’ and a Principal Research Scientist at the MIT Sloan School of Management, believes that despite being a new technology, generative AI shows promising signs of being a general-purpose technology similar to the steam engine.

Since the Industrial Revolution, a handful of technologies have been powerful enough to accelerate overall economic development, the author said in his report, “Economic Impact of Generative AI.” These “general purpose” technologies include the steam engine, the internal combustion engine, electrification, and the computer.

In the report, the author argued that generative AI is a new general-purpose technology and may spread faster than its predecessors.

The opinions expressed in the said report are solely those of the author

Generative artificial intelligence is a newly developed artificial intelligence capable of producing new and original content such as text, images, videos and audio. It performs tasks by learning statistical models from existing data and using those models to generate new output on demand.

“Usage technologies not only increase productivity and economic growth, but also promote many other advances. We expect generative AI to accelerate scientific discovery, help innovators and engineers build better, and give creative people new ways to express themselves and move their audiences,” the author recently wrote in his published report.

The author claimed that new technologies bring challenges as well as advantages. Citing an example, he argued that the internal combustion engine, for example, polluted the atmosphere, made conflicts more deadly and led to massive job changes as workers moved from farms to factories.

“But in the long term, the overall effect of technological development has been very positive. In recent decades, working hours have decreased while the standard of living has improved all over the world.”

According to one estimate, the author said that nearly 80 percent of jobs in the U.S. economy could do at least 10 percent of their tasks twice as fast (with no loss of quality) using generative AI.

Previous general-purpose technologies such as the steam engine and electrification have brought changes over the decades. However, the author anticipates that the effects of generative artificial intelligence will be felt faster due to the ease with which it spreads.

“In addition to faster growth, generative AI will bring other changes. It will reduce demand for some skills, increase others and create demand for entirely new ones,” it added.

“Previous general-purpose technologies have led to changes in leading companies and countries in various industries. We believe that generative artificial intelligence will be just as powerful.” (LETTER I)

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