Artificial intelligence and unemployment: moderating effect of the agglomeration economy in countries with different income levels
Patricia Hernández Medina
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Abstract
We examine the effect of AI adoption on unemployment in countries with different income levels, considering two key moderators: internet access and population density, by estimating panel data for 61 countries (2021-2024). The Global AI Index is considered to measure AI development, the unemployment rate as the dependent variable, in addition to control and moderator variables. The results show that, in high-income countries, the use of AI has a negative and significant effect on unemployment, while, in middle- and low-income countries, the impact is less clear and not significant. The effect is reinforced when accompanied by a better technological infrastructure. Population density does not significantly moderate the relationship between AI and unemployment, especially in less developed economies.
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