Macroeconomic Implications of Artificial Intelligence

Vegard M. Nygaard, Jonathan W. Welburn, Anujin Nergui

Expert InsightsPublished Aug 25, 2025

Increasing integration of AI into the economy presents both challenges and opportunities. The authors explore AI's dual effects — potential for productivity growth and risks of labor displacement. AI adoption could boost productivity, raise incomes, and reduce federal debt; data center construction may create jobs. Early evidence suggests AI is complementing labor productivity, but there is risk of future labor displacement as capabilities advance.

This is part of the Social and Economic Policy Rethink Initiative, a RAND effort to transform the approach to solving social and economic policy problems.

Topics

Document Details

Citation

Chicago Manual of Style

Nygaard, Vegard M., Jonathan W. Welburn, and Anujin Nergui, Macroeconomic Implications of Artificial Intelligence. Santa Monica, CA: RAND Corporation, 2025. https://www.rand.org/pubs/perspectives/PEA3888-3.html.
BibTeX RIS

Funding for this work was provided by the contributions of the RAND Social and Economic Policy Advisory Board; generous gifts by Frank M. Clark, Michael J. Critelli, William A. Downe, Jihee Kim Huh and Peter Yun Huh, and the Donald M. James Family Foundation. The work was conducted by RAND Social and Economic Well-Being.

This publication is part of the RAND expert insights series. The expert insights series presents perspectives on timely policy issues.

This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.

RAND is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.