SwedenLivingWorld world_2_fill WorldBusiness BusinessSports sports-soccer SportsEntertainmentEntertain

Star Economist: Sweden Can Become AI Pioneer Nation

The international star economist Daron Acemoglu sees a great danger that AI development will lead to people losing their jobs, and that the rich companies will become richer. But there is another possibility – which builds on the Swedish model.

» Updated: 16 July 2024, 16:24

» Published: 26 June 2024

Star Economist: Sweden Can Become AI Pioneer Nation
Photo: Lars Pehrson/SvD/TT

The international star economist Daron Acemoglu sees a great danger that AI development will lead to people losing their jobs, and that rich companies will become richer.

But there is another possibility – which builds on the Swedish model.

Daron Acemoglu is a professor at the American MIT and is one of the authors behind the acclaimed books "Why nations fail" and "Power and progress".

In the latter, he and co-author Simon Johnson argue that it is a mistaken view that technological leaps automatically bring greater prosperity to society as a whole, and that history is full of examples where this is not the case. Acemoglu sees signs that many companies view AI as a way to replace people with machines.

I am more worried today than two years ago, because the amount of resources concentrated in the hands of the largest and most powerful companies is only increasing, he says in an interview with TT, in connection with his participation via link in the Social Democrats' economic-political seminar in Almedalen.

More cooperative spirit

But he believes that there is another possibility. That AI develops to help employees become more productive. This is also something that can benefit companies.

He draws a historical parallel to Sweden in the 1930s, where the foundation of the Swedish model was laid with the Saltsjöbaden Agreement.

The pact that emerged then was a more cooperative spirit between companies and labour, and that companies remained profitable. I do not believe that there is any evidence that companies would have adopted these rules on their own without the Social Democratic government.

He would like to see Sweden, with pressure from politics, build on the model to drive innovation, profitability, and increased prosperity within AI.

Not shorter working hours

Daron Acemoglu, on the other hand, does not believe in striving for shorter working hours, even if AI makes jobs fewer.

I am not super keen on shorter working weeks. If we become more productive, wages increase, and workers say they want to work less, then fine.

However, one cannot replace a 40-hour week with two people working 20 hours each, according to him.

If you do that, work becomes expensive, and then there are no incentives to increase the number of employees, he says.

On the other hand, he believes in a shift from office work to another type of job.

I believe that many meaningful jobs will involve interacting with the physical world, it is the healthcare sector, the education sector, in factories, in crafts – gardeners, electricians, and carpenters. We must find a way to make those jobs more productive with AI, so that people can gain higher expertise in their work.

Turkish-American economist born 1967 in Istanbul, Turkey.

Despite his relatively young age, he has been among the top candidates for the economics prize in memory of Alfred Nobel several times, including on the economics site Ekonomistas' annual vote.

His research focuses on what is usually described as political economy, economic history, and growth studies.

Tags
TTT
By TTThis article has been altered and translated by Sweden Herald

More news

Message on the shells at the CEO murder in New York
2 MIN READ

Message on the shells at the CEO murder in New York

Mercosur agreement near – EU base on site
2 MIN READ

Mercosur agreement near – EU base on site

OPEC and Russia Postpone Production Increase
1 MIN READ

OPEC and Russia Postpone Production Increase

Svantesson on tariffs: Thinks it's outrageous
1 MIN READ

Svantesson on tariffs: Thinks it's outrageous

The Government Makes Mortgage Loans Cheaper
1 MIN READ

The Government Makes Mortgage Loans Cheaper

New EU Boss: Google Breakup "Still on the Table"
1 MIN READ

New EU Boss: Google Breakup "Still on the Table"

Tupperware Leaves Sweden and Europe
1 MIN READ

Tupperware Leaves Sweden and Europe

Paper Receipt – No Longer a Requirement
1 MIN READ

Paper Receipt – No Longer a Requirement

Downward trend for retail trade in the eurozone
1 MIN READ

Downward trend for retail trade in the eurozone

Billion Support for SSAB's Transformation
1 MIN READ

Billion Support for SSAB's Transformation

Headwind for French Industrial Production
1 MIN READ

Headwind for French Industrial Production

Green light for British telecom merger
1 MIN READ

Green light for British telecom merger

New oil and gas giant in British waters
1 MIN READ

New oil and gas giant in British waters

Danske Bank lowers adjustable mortgage rate
1 MIN READ

Danske Bank lowers adjustable mortgage rate

Unexpectedly small decline in German order intake
1 MIN READ

Unexpectedly small decline in German order intake

Inflation rises – "The Central Bank will lower anyway"
4 MIN READ

Inflation rises – "The Central Bank will lower anyway"

Stock Exchange Up for Seventh Consecutive Day
2 MIN READ

Stock Exchange Up for Seventh Consecutive Day

Employees sue Meta – had to review rapes
1 MIN READ

Employees sue Meta – had to review rapes

The Swedish Transport Administration: Stop the Expansion of Electric Roads
1 MIN READ

The Swedish Transport Administration: Stop the Expansion of Electric Roads

Record number of villas sold this year
1 MIN READ

Record number of villas sold this year