Artificial Intelligence is set to double annual economic growth rate in the developed world while also boosting productivity over the next two decades.
The finds are contained in new research by Accenture called Why Artificial Intelligence is the Future of Growth.
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The authors said that the improvements will be driven by changing the nature of work and the evolution of a new relationship between man and machine.
According to Paul Daugherty, chief technology officer, Accenture. “Artificial Intelligence is poised to transform business in ways we’ve not seen since the impact of computer technology in the late 20th century.”
He said the combinatorial effect of Artificial Intelligence, cloud, sophisticated analytics and other technologies is already starting to change how work is done by humans and computers, and how organizations interact with consumers in startling ways.
“Our research demonstrates that as AI matures, it can propel economic growth and potentially serve as a powerful remedy for stagnant productivity and labor shortages of recent decades.”
The study looked at the size of each country’s economy in 2035 in a baseline scenario, which shows expected economic growth under current assumptions. It then compared this to an AI scenario, which shows expected growth once the impact of AI has been absorbed into the economy.
“AI was found to yield the highest economic benefits for the United States, increasing its annual growth rate from 2.6 per cent to 4.6 per cent by 2035, translating to an additional USD $8.3 trillion in gross value added (GVA),” said the authors.
In the United Kingdom, it was found that AI could add an additional USD $814 billion to the economy by 2035, increasing the annual growth rate of GVA from 2.5 to 3.9 per cent.
Japan has the potential to more than triple its annual rate of GVA growth by 2035, and Finland, Sweden, the Netherlands, Germany and Austria could see their growth rates double.
The potential to significantly boost the productivity of labor in developed economies will be driven by innovative AI technologies that enable people to make more efficient use of their time and do what humans do best – create, imagine and innovate new things, said the authors.
“The productivity increase dramatically reduces the number of years required for the 12 analyzed countries to double in size. This “doubling time” is an indicator of economic development and the results are primarily driven by a country’s ability to diffuse technological innovations into its wider economic infrastructure.”
Accenture recommends the following steps be taken to help navigate the complexity of issues:
- Prepare the next generation – integrate human intelligence with machine intelligence so they can successfully co-exist in a two-way learning relationship and reevaluate the type of knowledge and skills required for the future.
- Encourage AI-powered regulation – update and create adaptive, self-improving laws to close the gap between the pace of technological change and the pace of regulatory response.
- Advocate a code of ethics for AI – ethical debates should be supplemented by tangible standards and best practices in the development and use of intelligent machines.
- Address the redistribution effects – policymakers should highlight how AI can result in tangible benefits and preemptively address any perceived downsides of AI, helping groups disproportionately affected by changes of employment and incomes.
“Artificial intelligence heralds dramatic potential for growth for both the economy and for humans,” said Mark Purdy, managing director – Economic Research, Accenture Institute for High Performance.
“Our research strongly shows that AI can unleash remarkable benefits across countries, countering slow economic growth and lagging productivity. To fulfill the promise of AI, relevant stakeholders must be thoroughly prepared – intellectually, technologically, politically, ethically and socially – to address the benefits and challenges that can arise as artificial intelligence becomes more integrated in our daily lives.”