Automation can be privately optimal yet socially excessive when it hits high-MPC low-wealth households hard and ownership is concentrated, because firms ignore the resulting drop in aggregate consumption demand.
Generative AI could raise global GDP by 7 percent
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The Demand Externality of Automation
Automation can be privately optimal yet socially excessive when it hits high-MPC low-wealth households hard and ownership is concentrated, because firms ignore the resulting drop in aggregate consumption demand.