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The Coming of AI Spring
By James Manyika, Jacques Bughin  |  Jun 29, 2021
The Coming of AI Spring
Image courtesy of and under license from Shutterstock.com
AI is all around us, generating excitement about how it could increase prosperity and transform our lives in multiple ways. Yet the technology is also likely to be disruptive. Policymakers and businesses must therefore try to capture the full value of what AI has to offer, while avoiding the downside risks.

SAN FRANCISCO - Artificial intelligence (AI) is all around us, generating excitement about how it could increase prosperity and transform our lives in multiple ways. Yet the technology is also likely to be disruptive. Policymakers and businesses must therefore try to capture the full value of what AI has to offer, while avoiding the downside risks.

The idea of AI has been around for more than a half-century, and we have lived through previous periods of excitement followed by long stretches of disappointment – “AI winters” – when the tech didn’t live up to the hype. But recent progress in AI algorithms and techniques, combined with a massive increase in computing power and an explosion in the amount of available data, has driven significant and tangible advances, promising to generate value for individuals, businesses, and society as a whole.

Companies are already applying AI techniques in sales and marketing to make personalized product recommendations to individual customers. And in manufacturing, AI is improving predictive maintenance by applying deep learning (DL) to high volumes of data from sensors. By deploying algorithms to detect anomalies, firms can reduce the downtime of machinery and equipment, from jet engines to assembly lines. Our research has highlighted hundreds of such business cases, which together have the potential to create between US$3.5 trillion and US$5.8 trillion in value per year.

AI can contribute to economic growth by augmenting and substituting for labor and capital inputs, spurring innovation, and boosting wealth creation and reinvestment. AI will also create some negative externalities and transition costs, but these will be outweighed by its benefits.

We estimate that AI and analytics could add as much as US$13 trillion to total output by 2030, increasing the annual rate of global gross domestic product (GDP) growth by more than one p

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