Daily Management Review

McKinsey Study Claims Global Growth To Be Spurred By AI


09/05/2018




McKinsey Study Claims Global Growth To Be Spurred By AI
A simulation from McKinsey Global Institute claims that there can be a growth of 1.2 per cent to annual gross domestic product at least for the next decade or so because of the contribution from artificial intelligence (AI).
 
The report compared the economic impact of the technology, which is pegged to contribute about $13 trillion more to the global economic activity by 2030, to other technological developments such as the discovery and creation of the steam engine.
 
About 70 per4 cent of all the companies in the world would adopt one or more forms of Ai by the year 2030, predicts the institute's model in the report which was published on Tuesday. The report also predicts that the entire range of technology offered by Ai would be adopted by larger global firms.
 
Human behavior is mimicked by AI using large data sets and algorithms. Significant investment in the technology is being done in two of the largest economies of the world – the United States and China. The McKinsey report especially pointed out the case of China which has incorporate development and furthering of AI technologies in its five-year plan that runs through 2020 and desires to transform itself as the global in the technology by 2030.
 
"Without AI, China might face a challenge to achieve its target growth rate," Jeongmin Seong, one of the report's authors and a senior fellow at McKinsey Global Institute in Shanghai, said in an interview with a television channel.
 
The Chinese economy is in a transition period from an exporting one to a consuming one and the labor productivity ion China is lower than the global average, he noted. There would be a significant impact of Ai based technologies in sales and marketing that could increase consumer spending, Seong believes. He added that there would be significant returns in the supply chain and manufacturing businesses with the help of AI technologies.
 
According to the McKinsey report, multiple channels would be used for extracting the benefits and impacts of AI on the economy. such channels or modes would include aiding or augmenting and even substituting human labor, expansion of the range of products and services currently available, enhancing data flows globally and creating wealth.
 
However, there would also be a range of corporate and societal restructuring costs in implementing the technology, the report also noted. The report also noted that the AI technology would also disrupt employment and potentially reduce consumption.
 
"The productivity enhancing, labor-saving technology is a challenging issue for all of the economies in the world," Takashi Miwa, chief Japan economist at Nomura, said at a press briefing on Tuesday. Technologies such as AI will likely lead to greater income inequality, he said.
 
About 20 to 25 per cent more in economic benefits could be captured, against the current levels, by the countries that have already taken the lead in the AI technology which are mainly developed economies, McKinsey analysis also found. It also mentioned that only about half of the gains would be realized by emerging economies.
 
"This inequality is not given," Seong said. "The future is up to us to shape."
 
(Source:www.cnbc.com)






Science & Technology

Bain & Company: E-wallets and cheaper transactions are new payment trends

Is UAV drone industry falling into decay?

UK Scotland Yard employs AI to deal with frauds

US sets to fight robocalls outbreak

Top 7 green energy innovators

Volvo’s New Car Uses Blockchain For Recycled Cobalt

False Memories Can Be Created By Fake News On Social Media, Shows A Study

DEF CON Hosts Auto-Makers And Cybersecurity Enthusiasts

WHO found no danger in microplastics in drinking water

Apple starts testing Chinese OLED screens for iPhone 12

World Politics

World & Politics

US FAA invites representatives from 50 countries to discuss 737 MAX certification

Iran Blamed By US’s Pompeo For The Drone Attacks On Saudi Oil Facility

IMF: Georgieva is the only candidate to replace Lagarde

Saudi Arabia to issue tourist visas

USA introduces sanctions against Iranian space agencies

Investments continue to flow into Cape Verde and exceed expectations of Minister of Finance Olavo Correia

USA, UK to create a working group on economics

Global Fashion Companies Support Environment Protection At G7 Summit