“Age of AI: Technology and the Fate of Nations” with Carl Benedikt Frey

The guest of Institute Social’s Global Reflections series on December 5 was Prof. Dr. Carl Benedikt Frey, an economic historian, economist, and author from the University of Oxford. In his talk titled Age of AI: Technology and the Fate of Nations, Frey examined the impact of artificial intelligence on the global economy, labor markets, and international competition within a multidimensional framework.

In the first part of the discussion, Frey focused on the capabilities and limitations of AI. He emphasized that while artificial intelligence is extremely powerful at memorization and static knowledge domains, it has yet to replace humans in areas such as creativity, perception, and complex social interaction. He noted that these three domains remain fundamental “bottlenecks” for AI, adding that rapid and ongoing changes in the global context are making these limitations even more apparent.

The conversation then turned to labor markets and the global economy. Frey explained that automation is exerting particular pressure on logistics and routine occupations, while trade in services, outsourcing, and digitalization are creating new opportunities. He noted that even if AI does not eliminate many jobs entirely, it may lead significant portions of certain professions to shift toward lower-cost countries. He stressed that this trend represents an opportunity for developing economies, but poses a serious challenge particularly for white-collar workers in advanced economies.

When discussing education and individual skills, Frey approached the question of “which profession to choose” in the age of AI with caution. He stated that there is no single field to avoid, emphasizing that classical sciences, mathematics, and physics still provide a strong foundation. According to Frey, the decisive factor is whether one’s work is static or open to generating new knowledge and responding to changing conditions. Highlighting the centrality of learning, he remarked, “If there is a shortcut, people will take it, which is why we need exams that create space for genuine learning.” He also underscored that AI should be positioned not merely as a tool that produces outputs, but as a support mechanism that deepens learning.

The final part of the discussion focused on political economy and regulation. Frey noted that AI has enormous potential to generate wealth, but that the real issue lies in how this value is distributed across society. While he is not entirely opposed to the idea of universal basic income, he emphasized that it must be supported by targeted and equitable mechanisms. He also warned of monopolization risks in AI regulation, arguing that excessive regulation could stifle innovation, while insufficient regulation could give rise to extremely powerful and unaccountable actors.

The event concluded with participants’ questions and evaluations, highlighting that artificial intelligence is not merely a technological issue but one that calls for a broad political economy debate spanning education, politics, labor, and welfare.