AI holds tantalising promise for the emerging world

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AI holds tantalising promise for the emerging world

The Economist | January 25, 2024

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New technology brings with it both the sweet hope of greater prosperity and the cruel fear of missing out. Many technologies, such as online-education courses, have generated more hype than economic growth in the emerging world. Some people worry that generative artificial intelligence (ai), too, will disappoint the global south. The big winners so far seem to be a bunch of Western early adopters, as well as startups in San Francisco and America’s “magnificent seven” tech firms, which include Microsoft and have together added an astonishing $4.6trn to their market value since Chatgpt’s launch in November 2022.

Yet ai stands to transform lives in the emerging world, too. As it spreads, the technology could raise productivity and shrink gaps in human capital faster than many before it. People in developing countries need not be passive recipients of ai, but can shape it to suit their own needs. Most exciting of all, it could help income levels catch up with those in the rich world.  Because emerging countries have fewer white-collar workers, the disruption and the gain to existing firms may be smaller than in the West. The IMF says that a fifth to a quarter of workers there are most exposed to replacement, compared with a third in rich countries.

Developing economies have long been held back by a lack of educated, healthy workers.  If ai can make people in poorer countries healthier and better educated, it should in time also help them catch up with the rich world.  Pleasingly, these benefits could spread faster than earlier waves of technology.  Moreover, the technology can be tailored to local needs. 

So far there is little sign that ai is ruled by the winner-takes-all effects that benefited America’s social-media and internet-search firms. That means a variety of approaches could prosper.  Some countries are already harnessing ai. Each country will shape the technology in its own way.  Though the global south will not dislodge America’s crown, it could benefit widely from all this expertise.

Plenty could yet go wrong, obviously. The technology is still evolving. Computing power could become too expensive; local data will need to be gathered and stored. Some practitioners may lack the ability to take advantage of the knowledge at their fingertips, or the incentive to try new things.  The good news is that investments to speed ai’s diffusion will be richly rewarded. Much about the ai revolution is still uncertain, but there is no doubt that the technology will have many uses and that it will only get better. Emerging countries have suffered disappointments before. This time they have a wonderful opportunity—and the power to seize it.

3 key takeaways from the article

1. New technology brings with it both the sweet hope of greater prosperity and the cruel fear of missing out. Many technologies, such as online-education courses, have generated more hype than economic growth in the emerging world. Some people worry that generative artificial intelligence (AI), too, will disappoint the global south.
2. Yet AI stands to transform lives in the emerging world, too. As it spreads, the technology could raise productivity and shrink gaps in human capital faster than many before it. People in developing countries need not be passive recipients of ai, but can shape it to suit their own needs. Most exciting of all, it could help income levels catch up with those in the rich world.
3. So far there is little sign that ai is ruled by the winner-takes-all effects that benefited America’s social-media and internet-search firms. That means a variety of approaches could prosper. Yet, plenty could yet go wrong, obviously.

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Topics:  Technology, Artificial Intelligence, Development