DOI: https://doi.org/10.36347/sjebm.2025.v12i01.002

Pages: 8-22

This study examines the impact of artificial intelligence (AI) adoption on economic growth and unemployment across G7 countries and India. As AI emerges as a transformative technology, there is a need to understand its effects on labour markets and develop appropriate policy frameworks. The research analyses historical patterns of automation and technological change to provide context for the current AI revolution. The study employs a mixed-methods approach, combining quantitative statistical analyses with qualitative assessments. Variables examined include GDP growth rates, R&D investment levels, AI adoption rates, and productivity gains. Descriptive statistics, correlation analyses, regression models, and cluster analyses were conducted to identify relationships between key variables. Results reveal a significant technology adoption gap between high-tech leaders and developing economies. A growth paradox was observed in developing tech economies, where rapid AI adoption did not necessarily translate to proportional economic gains. The research found complex relationships between technological advancement, unemployment rates, and investment levels across countries. Cluster analysis identified three distinct groups: Advanced Economies, Technology Leaders, and Developing Tech Economies. ANOVA and chi-square tests confirmed statistically significant differences between these clusters. Multiple regression analysis on unemployment rates provided insights into the factors influencing job displacement. Key findings include: 1) AI adoption shows potential to significantly boost GDP growth and productivity, though effects vary by country. 2) The relationship between technological progress and unemployment is nuanced, defying simplistic narratives. 3) Investment levels strongly correlate with technological advancement, but other factors also play important roles. 4) Leaders in AI adoption exhibit certain common characteristics, offering potential lessons for other ...