Daniel Rock (University of Pennsylvania) : GPTs are GPTs: An Early Look at the Labor Market Impact Potential of Large Language Models

Daniel Rock : GPTs are GPTs: An Early Look at the Labor Market Impact Potential of Large Language Models

Authors: Tyna Eloundou, Sam Manning, Pamela Mishkin and Daniel Rock

Abstract:
We investigate the potential implications of large language models (LLMs), such as Generative Pre- trained Transformers (GPTs), on the U.S. labor market, focusing on the increased capabilities arising from LLM-powered software compared to LLMs on their own. Using a new rubric, we assess occupations based on their alignment with LLM capabilities, integrating both human expertise and GPT-4 classifications. Our findings reveal that around 80% of the U.S. workforce could have at least 10% of their work tasks affected by the introduction of LLMs, while approximately 19% of workers may see at least 50% of their tasks impacted. We do not make predictions about the development or adoption timeline of such LLMs. The projected effects span all wage levels, with higher-income jobs potentially facing greater exposure to LLM capabilities and LLM-powered software. Significantly, these impacts are not restricted to industries with higher recent productivity growth. Our analysis suggests that, with access to an LLM, about 15% of all worker tasks in the US could be completed significantly faster at the same level of quality. When incorporating software and tooling built on top of LLMs, this share increases to between 47 and 56% of all tasks. This finding implies that LLM-powered software will have a substantial effect on scaling the economic impacts of the underlying models. We conclude that LLMs such as GPTs exhibit traits of general-purpose technologies, indicating that they could have considerable economic, social, and policy implications.

Bio of speaker:
Daniel Rock is an assistant professor in the Operations, Information, and Decisions department at the Wharton School of the University of Pennsylvania. He is one of the affiliated faculty members at Wharton AI for Business. His research is centered on the economic impact of digital technologies. His work shows that new digital technologies and intangible assets are an increasingly important component of economic activity. Investment in data assets, machine learning and artificial intelligence, and technological human capital are critical margins for firm competition and social change in this environment. He is a Digital Fellow at both the MIT Initiative on the Digital Economy and the Stanford HAI Digital Economy Lab.

Discussant: Daron Acemoglu (MIT) 

Bio of discussant:
Daron Acemoglu an Institute Professor at MIT and an elected fellow of the National Academy of Sciences, American Philosophical Society, the British Academy of Sciences, the Turkish Academy of Sciences, the American Academy of Arts and Sciences, the Econometric Society, the European Economic Association, and the Society of Labor Economists. He is also a member of the Group of Thirty. His academic work covers a wide range of areas, including political economy, economic development, economic growth, technological change, inequality, labor economics and economics of networks. Daron Acemoglu has received the inaugural T. W. Shultz Prize from the University of Chicago in 2004, and the inaugural Sherwin Rosen Award for outstanding contribution to labor economics in 2004, Distinguished Science Award from the Turkish Sciences Association in 2006, the John von Neumann Award, Rajk College, Budapest in 2007, the Carnegie Fellowship in 2017, the Jean-Jacques Laffont Prize in 2018, the Global Economy Prize in 2019, and the CME Mathematical and Statistical Research Institute prize in 2021. He was awarded the John Bates Clark Medal in 2005, the Erwin Plein Nemmers Prize in 2012, and the 2016 BBVA Frontiers of Knowledge Award. He holds Honorary Doctorates from the University of Utrecht, the Bosporus University, University of Athens, Bilkent University, the University of Bath, Ecole Normale Superieure, Saclay Paris, and the London Business School. He is the author of five books, including New York Times bestseller Why Nations Fail: Power, Prosperity, and Poverty (joint with James A. Robinson), Introduction to Modern Economic Growth, and The Narrow Corridor: States, Societies, and the Fate of Liberty (with James A. Robinson). His new book, Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity (joint with Simon Johnson), will be published May 2023. 

Zoom webinar link. Webinar ID: 928 1163 1623 Passcode: 014548