Artificial Intelligence Plays A Role Behind the Scenes in GDP
- Claire Carpenter
- 24 hours ago
- 2 min read
As technology advances every day, the problem-solving potential of artificial intelligence grows exponentially. According to a report given by Stanford University Human-Centered Artificial Intelligence, the FDA has approved 200+ AI-powered medical devices, self-driving car company Waymo provides over 150,000 autonomous rides each week, and accessing AI chatbots has never been easier. It’s safe to say that AI’s impact has hit like a shockwave — you can feel it in almost every area of daily life. One area that is feeling this tremor is GDP, but perhaps more deeply than we think.
Artificial intelligence stretches expansively across immensely powerful computers, known as
data centers. These data centers can typically be described as large warehouses filled with cloud-based computers that store and process data. Constructing these centers has boosted the real US economic activity measure by about $160 billion, which would be about 0.7% of total GDP, according to analysts at Goldman Sachs. However, only $45 billion of that $160 billion is being counted in official GDP statistics measured by the Commerce Department’s Bureau of Economic Analysis. If only 28% of AI-powered growth is being recorded, where is the other 62% going? Is there more that isn’t being counted?
The gap in economic output is likely because GDP only counts final goods and services, excluding a key component of artificial intelligence processes: semiconductors. These high-performance chips are designed for intense workloads and difficult data analyses; but because they don’t directly deliver information to consumers, they’re categorized as intermediate in the AI “production” process. Therefore, this informational transaction is excluded from GDP. In addition, there is much intangibility in the digital ecosystem that AI “lives” in. While data can be collected and processed, most of the time it isn’t sold as a final good, also shortening the measurable monetary impact of artificial intelligence.
While artificial intelligence has seemingly integrated into our society overnight, we most definitely haven’t uncovered all the economic impacts it has to offer. Undercounting the impact of semiconductors and the unquantifiable measure of data leads us to an unreliable conclusion. As artificial intelligence evolves, we too must evolve in our data collection and analysis to fully understand how it will impact our economy.
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