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"Every so often, in the arc of human history, a series of groundbreaking technological innovations engender a major socioeconomic shift."

These shifts are marked by the concentration of our civilization's collective effort toward the inputs required for re-producing or sustaining this technology, and the subsequent innovations that these contemporary creations afford. Our industries, our vocations, our cities, our relationships, and our cultures evolve in accordance with these ubiquitous, powerful inventions. The rapid succesion of multiple groundbreaking innovations of this kind produces a technological revolution—e.g., the agricultural revolution, industrial revolution, scientific-technical revolution, and digital revolution.

From the last century, individual transformative innovations include: automobiles, aeroplanes, personal computers, the internet, and mobile phones. For example, the widespread use of automobiles changed how we think about time, given the productivity gains of long-distance mobility. To facilitate smoother travel, city planners procured roads, motorways, and suburban markets, enhancing the strategic and commercial value of centrally-accessible locations. This terraforming also reshaped supply chains, improved food distribution and the availability of retail goods, and created myriad employment opportunities—both due to industrial growth and the capability to commute to work. For instance, it's estimated that even today, every automotive assembly line job creates another 10 jobs across other sectors 1

More recently, the platform shift of mobile phones has spurred a comparable cascade of upstream and downstream socioeconomic transformations. Phones changed how we think about connectivity and communication; created virtual value chains for third-party applications; increased demand for metals and microchip production; and drove a vast array of growth in wearables, smart home devices, and telecommunications infrastructure. Some studies have suggested that a 10-percent increase in mobile phone penetration can increase a country's economic growth rate by 0.6 to 0.8 percentage points 2.

At present, recent advances in AI foreshadow a new technologically-mediated transformation: the so-called Fourth Industrial Revolution, also known as “The Intelligence Revolution”.

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Consider how modern Large Language Models (LLMs) can already exceed average human performance on many rigorous tests in law 4, medicine 5, and mathematics 6, while the ability to simulate realism across modalities—such as text-to-video—is also advancing rapidly 7. As these imitations of human intelligence deepen and their domain of application widens, the promise of advanced AI seems to be arriving far sooner than most of us imagined.

Business leaders are taking notice of the leaps and bounds that AI developers have made. The amount of data and computational power being poured into frontier models has continually followed an exponential curve for multiple decades. This has led to a trend where training costs are more than tripling every year 8. Global investment in AI is experiencing explosive growth beyond 50% in some years, with reports estimating that AI investments could approach $200 billion globally by 2025 9. In this booming market, AI software revenue alone is projected to reach $126 billion by 2025 10, while the overall investment in AI research and applications is forecasted to reach $500 billion by 2027 11.

With all that in mind, it has been estimated that AI's contribution to the global economy could reach $15.7 trillion by 2030—that's more than all of Europe's GDP in the year 2021.

The market's hypothesis is clear: AI—especially in concert with advancements in robotics, nanotechnology, biotechnology, the internet of things, or fifth-generation wireless technologies (5G)—is poised to catalyse another major socioeconomic shift. Potentially, the biggest humanity has seen yet.

Footnotes​

  1. Alliance For Automotive Innovation. “Driving the U.S. Economy”, 2023. https://www.autosinnovate.org/initiatives/the-industry. ↩

  2. The International Bank for Reconstruction and Development / The World Bank, 2009. “Information and Communications for Development: Extending Reach and Increasing Impact”. Washington, DC, The World Bank.. ↩

  3. Klaus Schwab, “The Fourth Industrial Revolution: What It Means and How to Respond,” World Economic Forum, 2016, https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/. ↩

  4. Katz, Daniel Martin, Michael James Bommarito, Shang Gao, and Pablo Arredondo. “GPT-4 Passes the Bar Exam.” SSRN Electronic Journal, 2023. https://doi.org/10.2139/ssrn.4389233. ↩

  5. Nori, Harsha, Nicholas King, Scott Mayer McKinney, Dean Carignan, and Eric Horvitz. “Capabilities of GPT-4 on Medical Challenge Problems.” arXiv.org, April 12, 2023. https://arxiv.org/abs/2303.13375. ↩

  6. Trinh, Trieu H., Yuhuai Wu, Quoc V. Le, He He, and Thang Luong. “Solving Olympiad Geometry without Human Demonstrations.” Nature 625, no. 7995 (January 17, 2024): 476–82. https://doi.org/10.1038/s41586-023-06747-5. ↩

  7. Open AI. “Video generation models as world simulators”, 2024. https://openai.com/research/video-generation-models-as-world-simulators. ↩

  8. Epoch. “Machine learning trends”, 2023. https://epochai.org/trends#investment-trends-section. ↩

  9. Goldman Sachs. “AI investment forecast to approach $200 billion globally by 2025, 2023. https://www.goldmansachs.com/intelligence/pages/ai-investment-forecast-to-approach-200-billion-globally-by-2025.html. ↩

  10. Kirkpatrick, Keith. “Artificial Intelligence Market forecasts”, March 2, 2024. https://omdia.tech.informa.com/om000840/artificial-intelligence-market-forecasts. ↩

  11. IDC. “IDC futurescape: Artificial Intelligence will reshape the IT industry and the way businesses operate”, 2023. https://www.idc.com/getdoc.jsp?containerId=prUS51335823. ↩