Israel Vargas
Prominent AI researchers expect the arrival of artificial general intelligence anywhere between “the next couple of years” and “possibly never.” At the same time, leading economists disagree about the potential impact of AI: Some anticipate a future of perpetually accelerating productivity, while others project more modest gains. But most experts agree that technological advancement, however buoyant, is no guarantee that everyone benefits…..Continue reading….
By: Katya Klinova
Source: MIT Technology Review
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Critics:
Artificial Intelligence (AI) is going to be a big game changer in the global economy, and much of the value potential is up for grabs. We estimate that AI could contribute up to $15.7 trillion to the global economy in 20301, more than the current output of China and India combined.
A wide adoption of AI innovations has been estimated to increase GDP by as much as 7% over a 10-year period (Goldman Sachs, 2023a), however the evidence so far reveals positive yet not impressive gains, which may be due to the complex nature of the phenomenon.A report by the McKinsey Global Institute estimates that by 2030, up to 375 million workers worldwide may need to switch occupations due to automation.
The impact of AI on unemployment is expected to be uneven, disproportionately affecting low-skilled and repetitive jobs. AI will be able to better analyse a variety of customer-related data which could lead to better tailored products and services. This could improve financial institutions’ product-to-customer match, increasing economic efficiency for both the institution and the customer.
Gen AI is being applied to numerous industries including healthcare, finance, transportation, manufacturing, entertainment, and retail. Case studies and data have shown how Gen AI could add trillions to the global economy while displacing workers at all levels, creating a quandary for economists. By 2030, AI will be unfathomably more powerful than humans in ways that will transform our world. It will also continue to lag human capabilities in other ways.
By 2050, economist Dr Carl Frey and Michael Osborne, a professor of machine learning, both at the University of Oxford, predict that at least 40 per cent of current jobs will be lost to automation, while management consultancy firm McKinsey puts the figure at 50 per cent. Goldman Sachs economists said in March last year that as many as 300 million full-time jobs could be lost or diminished globally by the rise of generative AI, with white-collar workers likely to be the most at risk.
AI is neither inherently good nor bad. It is a tool that can be used for both beneficial and harmful purposes, depending on how it is developed and used. It is important to approach AI with caution and responsibility, ensuring that it is developed and used in an ethical and transparent manner. Not all jobs will be replaced by AI, but many roles like customer service representative, truck driver and computer programmer could be automated.
In addition, AI could lead to new jobs like machine learning engineer and prompt engineer. The productivity of artificial intelligence may boost our workplaces, which will benefit people by enabling them to do more work. As the future of AI replaces tedious or dangerous tasks, the human workforce is liberated to focus on tasks for which they are more equipped, such as those requiring creativity and empathy.
In financial markets, technology has done a tremendous job in improving price discovery, deepening markets, and often dampening volatility in times of stress. And AI is likely to continue these trends as well. There are four specific risks most experts associate with AI: data poisoning, reverse engineering, deep fakes and non-compliance. Take data poisoning. A decade ago, banks had to worry about how to manage humans in the data chain.
AI acts as a force multiplier, allowing humans to focus on higher-order tasks that require creativity, critical thinking, and emotional intelligence. Rather than replacing workers, AI serves as a tool for augmenting human capabilities, leading to a more dynamic and productive workforce. AI in finance modernizes the entire industry by streamlining traditionally manual banking processes and unlocking deeper insights from generated data, helping dictate how and where investments are made.
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