AI boom could widen wealth inequality, Labor MP warns

Summarised from 2 outlets · Updated 12 Oct, 19:31 · Archive

Labor assistant minister Andrew Leigh warns that artificial intelligence could increase the gap between wealthy capital owners and workers unless its benefits are properly shared.

Labor assistant minister Andrew Leigh has warned that artificial intelligence could widen inequality between wealthy capital owners and workers if its benefits are not properly shared. The federal government is banking on AI to lift Australia's stagnant productivity growth and end a decade of lost living standards, but Dr Leigh is troubled by research suggesting the technology could increase the wealth divide.

According to studies cited by Dr Leigh, automation reduces businesses' reliance on workers, meaning the owners of productive technology will capture a larger share of the gains. "Those gains accrue disproportionately to households that already own more capital," he will say. "Higher returns compound over time. So automation widens the gap between the have-nots and the have-lots."

Dr Leigh, a former academic who has written about inequality in Australia, will outline his concerns in a virtual address to a JPMorgan AI conference on Tuesday. While there are signs AI could reduce wage inequality between workers, economists have long debated whether the overall effect of AI on inequality will be positive or negative. The comparison is drawn to the industrial revolution, which produced extremely wealthy industrialists whilst the broader workforce remained relatively poor.

How it is being reported

• AI could widen gap between have-nots and have-lotsLabor is banking on AI to drag Australia out of its productivity malaise, but one MP is concerned it could widen inequality between workers and the wealthy.Perth Now · 12 Oct, 19:03
• AI could widen gap between have-nots and have-lotsLabor is banking on AI to drag Australia out of its productivity malaise, but one MP is concerned it could widen inequality between workers and the wealthy.The West Australian · 12 Oct, 19:03

In this story: Andrew Leigh · Australia · JPMorgan

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