Contrary to widespread concerns that it may replace human jobs, artificial intelligence will create opportunities for new businesses, fostering innovation and skill development of workers both in China and other parts of the world, according to a renowned economist.
This process is not intentionally designed to impact the labor market. It is a natural progression, said Thomas Sargent, the 2011 Nobel laureate for economics and professor of economics at New York University.
Arguing that software and AI are just tools, Sargent said technological changes will continuously bring forth many new ideas.
“For example, before AI emerged, no one knew it would have such a significant impact on human society today,” he said. “Many ideas and innovations are constantly being generated, and some of them will lead to transformative changes. It is not predetermined which ideas will come to fruition or be created.”
Sargent said that the market mechanism will help individuals find new employment based on their abilities. As new technologies emerge, new businesses will arise, allowing workers to develop and apply new skills, therefore reintegrating surplus labor into the market.
Highlighting that AI can significantly reduce the cost of many business tasks, he said the widespread availability of smartphones, particularly from Chinese brands entering Africa, has enabled many African entrepreneurs to access online banking and embark on various new ventures.
The development and prospects of AI have provided businesses with hope and reasons for confidence, but there are also conflicting interests, said Chen Long, president of Hangzhou, Zhejiang province-based Luohan Academy, a think tank founded by Chinese tech heavyweight Alibaba Group Holding Ltd. It is vital to have a proper understanding of this technology, Chen said.
Sargent also stressed that in the current economic system, free trade permits an exchange of goods and ideas at low costs. This is a crucial point. It is essential to reemphasize the importance of free trade in the United States, he said.
Zhao Fujun, a researcher specializing in international economic cooperation at the Beijing-based Development Research Center of the State Council, shared similar views.
“Free trade not only encourages countries to specialize in producing goods and services where they have a comparative advantage but also helps reduce tariffs and other trade barriers. This results in lower prices and a broader range of choices for consumers in many countries and regions,” said Zhao.
He said the rapid development of China’s foreign trade has provided strong support for a faster recovery of the global economy, while promoting trade diversification and balanced growth.
Amid a complex and challenging external environment, including trade protectionist moves and tariffs imposed by some countries on its products, China’s foreign trade amounted to 21.17 trillion yuan ($2.91 trillion) in the first half, surging 6.1 percent year-on-year, the General Administration of Customs said.
“It is evident that the structure of China’s exports has been optimized, and positive progress has been made in the transformation and upgrading of goods trade,” said Liu Chunsheng, an associate professor at the Central University of Finance and Economics’ School of International Trade and Economics.
Chinese manufacturers’ exports of mechanical and electrical products reached 7.14 trillion yuan between January and June, up 8.2 percent on a yearly basis, accounting for 58.9 percent of China’s total export value, Customs statistics showed.
Liu said that private companies will continue to be the main drivers of China’s export growth, particularly those in high-tech and advanced manufacturing sectors.
That sentiment is in line with the latest data. The export value of China’s private businesses grew by 10.7 percent year-on-year to 7.87 trillion yuan in the first half, accounting for 64.9 percent of the country’s total export value, Customs data showed.
