In the 21st century, the relationship between economic development and technological innovation is becoming increasingly complex. In recent years, with the emergence of artificial intelligence as a pioneer and leader in technological innovation and its increasing use in many fields, unemployment is rising on the one hand, while on the other hand, unit costs are decreasing due to increased productivity. This dilemma has become a question that needs to be explored, especially for countries with technologies that make intensive use of artificial intelligence. To this end, this study examined the effects of artificial intelligence (AI) investments on economic development in Germany, the United States, China, France, South Korea, India, Italy, and Japan for the period 2012-2023 using panel data methods. The Human Development Index (HDI) is used as an indicator of economic development in the models developed for the analysis, while AI investments are treated as the main independent variable. Per capita income (PCI), inflation (INF), and foreign direct investment (FDI) are included in the model as control variables. Second-generation panel methods, such as the Pesaran– Yamagata homogeneity test, Pesaran CD tests, and the CIPS unit root test, are applied in the study, and long- and short-term relationships are analyzed using the CS-ARDL model. The research indicates that investments in AI have a beneficial and substantial effect on HDI over time. However, INF was found to have a negative impact on the HDI. It has been observed that the FDI variable has negative effects contrary to expectations. The heterogeneity of the variables' parameters suggests that the impact of AI investments on development varies across countries. In conclusion, AI investments appear to be a supportive element for economic development, but the appropriate macroeconomic and institutional framework must be provided for the sustainability of this impact.
İnal et al. (Wed,) studied this question.