economy
Quantifying the AI boom crowding-out effect
AI investment will be about $600 billion this year, some 2% of GDP, Goldman Sachs economists find.
TL;DR
- AI investment is projected to be around $600 billion, or 2% of GDP, this year.
- The crowding-out effect of AI investment includes displacing other tech investment and construction.
- AI investment also leads to increased corporate borrowing costs.
- Hyperscalers' demand for capital and data center construction margins draw resources from other projects.
- The overall impact on corporate borrowing costs and non-AI investment has been limited so far.