Technological path-dependency in AI adoption: evidence from Italian firms

Prior investments in advanced digital technologies encourage AI adoption. Yet AI integrates differently across technologies depending on existing human–technology relations. When combined with robotics, it tends to reinforce labor substitution; when matched with advanced information technologies (AIT) – such as big data – it supports human–machine complementarity. Firm-level evidence from a large sample of Italian firms supports this distinction. Results show that while prior investments in robotics and AIT are positively associated with AI adoption, only AIT facilitate investments in AI-related training, suggesting that workforce upskilling plays a minor role when AI operates in machine–machine configuration. Additional evidence shows that organizational practices, sectoral conditions, and pre-existing capabilities all play a mediating role. Indeed, AI adoption is more common among firms that invest in worker engagement and operate in industrial sectors, while fiscal incentives support adoption only among already digitalized firms, underscoring the importance of firms’ technological readiness.