Growth Effects of AI: Modest for a Decade or Two, At Least

It is of course impossible to predict the effects of new AI technologies on total economic growth in a precise way, but there are strong reasons to believe that the effect will be modest for a decade or two, anyway. Charles Jones Jones explores some of the reasons in “AI and Our Economic Future,” in the most recent Journal of Economic Perspectives (Summer 2026). His arguments readily accept that AI capabilities both have grown very rapidly and will continue to grow very rapidly: indeed, Jones begins by stating that “Artificial intelligence (AI) will likely be the most transformative technology of the modern era.” But he also suggests that growth of this particular technological capability will add to total economic growth in only a modest way for the medium term. (In the shade of this parenthesis, I will note that I work as Managing Editor of the Journal of Economic Perspectives. Because both the JEP and this post are freely available, I have no financial conflict of interest here.…