Researchtask based modelgenerative ailabor economicswage inequality
AI Reduces Wage Inequality, Raises Average Wages
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A working paper by Lukas Althoff and Hugo Reichardt released this week finds artificial intelligence lowers wage inequality while raising average wages by 21 percent. Using a dynamic task-based model, the authors identify 'simplification'—AI lowering skill barriers—as the primary mechanism, estimating 26–34% welfare gains for new entrants and large occupational reallocation.
