Geneva

Development partners meeting of the ILO Flagship Programme on Social Protection Floors

Partnership for Decent Work in Fisheries: Promoting the ratification and implementation of the Work in Fishing Convention No 188

Brussels

From political momentum to ratification and implementation of Convention No. 188

The macroeconomic impacts of AI

AI for Good

Switzerland

This event is organized as part of ITU's&nbsp;<a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Faiforgood.itu.int%2F&amp;data=05%7C02%7Cverick%40ilo.org%7C01dcaefe706c4875fe6908de6331068f%7Cd49b07ca23024e7cb2cbe12127852850%7C0%7C0%7C639057259462351456%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&amp;sdata=t4YtABbyu2ryqyQeLl7yGRb8FvaBx25v%2Fw88jtmuhHM%3D&amp;reserved=0">AI for Good Series</a>.Are we missing the true economic impact of AI? How can we equip policymakers with better tools? Investments in generative AI are accelerating rapidly, yet our understanding of its economy-wide impact remains limited. While firm-level studies and task-based evidence are expanding, macroeconomic projections still range from modest productivity gains to transformative growth effects. For policymakers, this uncertainty makes effective decision-making difficultThis session introduces a new World Bank Group modelling framework that treats AI not as a simple productivity shock, but as a structural transformation of the production process. By embedding&nbsp;<a href="https://eur03.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.brookings.edu%2Fwp-content%2Fuploads%2F2024%2F07%2FHardware-and-software-A-new-perspective-on-the-past-and-future-or-economic-growth.pdf&amp;data=05%7C02%7Cpolina.nash%40itu.int%7C809d8f9d7b294e1a9ef808de7b9f69dc%7C23e464d704e64b87913c24bd89219fd3%7C0%7C0%7C639084121790861731%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&amp;sdata=yJpzk8U9XM8Zy64V2m%2BiAsLIlUnfa0zcPrtako%2FK%2F2k%3D&amp;reserved=0">the hardware–software production paradigm</a>&nbsp;into the Bank’s dynamic CGE model (<a href="https://eur03.safelinks.protection.outlook.com/?url=https%3A%2F%2Fdocuments.worldbank.org%2Fen%2Fpublication%2Fdocuments-reports%2Fdocumentdetail%2F099543511132534267&amp;data=05%7C02%7Cpolina.nash%40itu.int%7C809d8f9d7b294e1a9ef808de7b9f69dc%7C23e464d704e64b87913c24bd89219fd3%7C0%7C0%7C639084121790881078%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&amp;sdata=pz90gRjC%2Fq3h8%2F0rd3ey82XH37%2B%2FGg5Ws5s8T7G8DmQ%3D&amp;reserved=0">MANAGE)</a>, we simulate how AI adoption reshapes sectors, occupations, prices, under budget constraints over time. The framework integrates detailed task-level occupational data, based on the&nbsp;<a href="https://eur03.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.ilo.org%2Fpublications%2Fgenerative-ai-and-jobs-refined-global-index-occupational-exposure&amp;data=05%7C02%7Cpolina.nash%40itu.int%7C809d8f9d7b294e1a9ef808de7b9f69dc%7C23e464d704e64b87913c24bd89219fd3%7C0%7C0%7C639084121790893638%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&amp;sdata=SwQhh72ltBOop8lru7nLcH5Ng%2B%2F8ZsgOe60HL%2FdjR88%3D&amp;reserved=0">ILO-NASK Index of GenAI Exposure</a>, which allows substitution patterns to vary across sectors, and models AI as a dual-capital bundle combining data, software, and intangible capital. It enables policymakers to assess alternative adoption scenarios and their implications for growth, structural change, and equity.By moving beyond partial-equilibrium approaches, this tool provides governments with a more coherent macroeconomic lens to design AI strategies that promote inclusive and sustainable development.Looking ahead into 2026, the discussion will discuss applying the framework in a first case study, Poland, and the possibility of applying it across different country contexts, particularly emerging and middle-income economies where policy design will be critical in shaping AI’s developmental impact.

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