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Will AI replace your job? Perhaps not in the next decade
Recent rapid improvements in the capabilities of artificial intelligence have raised concerns about these technologies' impact on employment. The ultimate effects of AI on the workforce will depend on the extent to which AI augments (or complements) rather than automates (or substitutes for) workers' tasks. Will this new technology aid workers or replace them?
As population trends shift, where will future workers come from?
Population is a fundamental determinant of a country’s productive capacity. More specifically, labor, along with capital and the efficiency with which the two can be combined (total factor productivity) determine how much a country can produce at any point in time.
Advances in AI will boost productivity, living standards over time
Artificial intelligence offers the potential to improve people’s living standards. Such advances can be approximated by changes in GDP per capita over time. Using that common measure, AI could enhance longstanding productivity gains or, alternatively, drastically alter the economy in relatively short order.
Transfer payments, household savings play key roles in growing U.S. deficit
While recent levels of government borrowing have been high, private savings by U.S. residents have been elevated as well. As a result, overall borrowing for the entire U.S economy has been remarkably stable.
Working Paper
The Interest Rate Effects of Government Debt and Deficits: Does Domestic Borrowing Have a Different Impact Than Foreign Borrowing?
This paper investigates the relationship between government debt and interest rates in advanced economies. We consider two separate, yet closely related puzzles in the data. Since the Global Financial Crisis, OECD countries have experienced a dramatic surge in government debt-to-GDP ratios, yet there was not a corresponding surge in sovereign bond yields. In addition, across countries there is no relationship between government debt levels and interest rates, and a country like Japan has the highest government debt level among advanced economies yet the lowest sovereign bond rates. To address ...
Working Paper
The Interest Rate Effects of Government Debt and Deficits: Does Domestic Borrowing Have a Different Impact Than Foreign Borrowing?
We investigate the relationship between government debt and interest rates. We ask whether the effect of government debt on interest rates depends on whether that debt is financed at home or abroad. We extend the work of previous studies that have estimated the effect of expected government debt or deficits on interest rates, and we add an international dimension by incorporating forecasts of the current account balance or net foreign asset position. We find that an increase in government debt financed from domestic savings has less of an effect on interest rates than an increase in ...