AI Diffusion and the Possibility of Full Unemployment: An Urgent but Neglected Issue

Artificial Intelligence (AI) is often viewed as a potential catalyst for mass unemployment. However, there has been a notable lack of contributions published in economics journals on this topic, with virtually none exploring the possibility of full unemployment. This article has three main goals. First, it defines full unemployment and outlines its key theoretical features. Second, it seeks to explain economists’ reluctance to acknowledge AI’s potential to induce mass unemployment and, a fortiori, full unemployment. Finally, the article aims to clarify why, despite its low probability, full unemployment deserves serious theoretical consideration and detailed analysis by economists. It suggests that full unemployment might be seen as the long-term asymptotic endpoint of short-term dynamics marked by rising unemployment, even if the actual magnitudes never reach it.

JEL Classification: E24, J23, J64, O33