Monday, November 18, 2024
Andrea Eisfeldt: The Impact of Generative AI on Firm Values
- Hybrid
- Seminar
The DEL Seminar Series is proud to host a diverse roster of bright minds from around the world to discuss various subjects surrounding economics and technology.
On November 18, 2024, Andrea Eisfeldt of the UCLA Anderson School of Management stopped by the Lab for her talk, “The Impact of Generative AI on Firm Values.”
How do recent advances in Generative AI affect firm value? We construct the first measure of firms’ workforce exposures to Generative AI and show that an “Artificial-Minus-Human” (AMH) portfolio that is long high-exposure firms and short low-exposure firms earned daily returns of 0.44% in the two weeks following the release of ChatGPT. The labor-exposure effect is more pronounced for firms with greater data assets and is distinct from the effect of firms’ product exposures to Generative AI. Highly-exposed workforces can be either substituted for or complemented by Generative AI technologies. We measure whether the exposed tasks are core or supplemental to assess relative substitutability. Examining firms’ labor demand and profitability following the release of ChatGPT supports a labor-technology substitution channel for the increases in exposed firms’ values that we document.
View paper
Andrea Eisfeldt
Laurence D. and Lori W. Fink Endowed Chair in Finance, UCLA Anderson School of Management
Andrea Eisfeldt is the Laurence D. and Lori W. Fink Endowed Chair in Finance at the UCLA Anderson School of Management. Her research focuses on the relationship between financial markets and the macroeconomy.
Eisfeldt’s research has been twice been awarded an Amundi Smith Breeden prize in the Journal of Finance. Her work has also been awarded the Jensen Prize in the Journal of Financial Economics, the Edwin Mills best paper award from Real Estate Economics, and grants from the National Science Foundation Grant and the Banque du France.
She recently served on the board of the American Finance Association, and currently serves on the board of the UCLA Investment Company. Eisfeldt is a research associate at the National Bureau of Economic Research in the Corporate Finance, Asset Pricing, and Economic Fluctuations and Growth working groups. Eisfeldt serves as an Associate Editor at the Journal of Political Economy and Journal of Economic Perspectives.