Introduction to “The Economics of Transformative AI”

We stand at the threshold of perhaps the most consequential economic transformation
since the Industrial Revolution. Leading artificial intelligence (AI) laboratories and
researchers are converging on a remarkable prediction: artificial intelligence systems that
match or exceed human cognitive capabilities across virtually all domains may emerge
within the coming decade. The leaders at frontier AI companies speak not in terms of
decades but years—with some suggesting that AI matching human intelligence could
arrive in less than five years. While such predictions carry inherent uncertainty, the recent
acceleration in AI capabilities suggests we are approaching an inflection point in human
history. The transition from an economy where human intelligence is the bottleneck factor
to one where intelligence becomes easily reproducible and abundant represents perhaps
the most significant economic transformation that humanity has experienced thus far. This
possibility—no longer confined to science fiction but actively discussed in corporate
boardrooms and policy circles—demands rigorous economic analysis to help society
navigate the profound changes ahead.

This volume presents a set of papers and their discussants’ comments presented at the
NBER Conference on the Economics of Transformative AI at Stanford in September
2025.