In a model economy with a monopolist-monopsonist firm and elastic labor supply, a rise in automation productivity can trigger a profit-driven switch to capital-only production that reduces total output.
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Can an increase in productivity cause a decrease in production? Insights from a model economy with AI automation
In a model economy with a monopolist-monopsonist firm and elastic labor supply, a rise in automation productivity can trigger a profit-driven switch to capital-only production that reduces total output.