Jorge Braga de Macedo's picture
Affiliation: 
Nova School of Business and Economics, Lisbon
Credentials: 
Emeritus Professor of Economics

Voting history

Artificial Intelligence and the Economy

Question 2: What will be the implications of recent developments in AI on unemployment in high income countries over the upcoming decade?

Answer:
Increase
Confidence level:
Confident
Comment:
The AI revolution may not cause job polarisation in high income countries as it will affect low-skilled, middle-skilled and high-skilled jobs. However unemployment is likely to increase in developing countries because geopolitical uncertainty involves countries like China, India, Brazil, Nigeria etc and that will have knock-on effects on high income countries.

Question 1: What will be the implications of recent developments in AI on global economic growth, as they mature over the upcoming decade?

Answer:
Increase (to 4-6%)
Confidence level:
Confident
Comment:
At the 2017 NBER conference on The Economics of Artificial Intelligence: An Agenda Ajay K. Agrawal, Joshua Gans, and Avi Goldfarb it was not yet clear that machine learning would become a general purpose technology but this seems to have happened and not just in developed countries. Assuming the 4% inflation going forward, a global growth above that rate presumes a lessening of geopolitical tensions which at the moment is not apparent. I still bet on the upside rather then no change or fall.

Prospects for Euro Area Inflation in 2023

Question 2: Relative to market forecasts of the ECB’s MRO rate peaking at 3.5%, which of the following is more likely during 2023?

Answer:
The MRO rate will peak above 3.5%.
Confidence level:
Confident
Comment:
As German 2y bonds hit 3% and the S&P Global purchasing managers’ index outstrips forecasts, the expected sharp rise in salaries will maintain pressure on prices.

Question 1: How likely is it that peak headline euro area inflation is behind us?

Answer:
Unlikely
Confidence level:
Confident
Comment:
The expression attributed to the Portuguese governor of «“at least” a few more rate hikes» should not ignore that major central banks are once again adding liquidity to global financial markets and a US debt ceiling crisis may confront the Fed.

Question 3:  Under its current policy trajectory, with rates peaking at 3.5%, which of the following is most likely?

Answer:
ECB policy rates will be appropriate in 2023.
Confidence level:
Not confident
Comment:
Rising non-US central bank flows and investor optimism about growth would keep ECB policy rates appropriate if geopolitical tensions abate but I am not confident that they will.

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