This paper examines the impact of AI on labor markets in both Advanced Economies (AEs) and Emerging Markets (EMs). The authors propose an extension to a standard measure of AI exposure, accounting for AI's potential as either a complement or a substitute for labor. They analyze worker-level microdata from 2 AEs (US and UK) and 4 EMs (Brazil, Colombia, India, and South Africa), revealing substantial variations in unadjusted AI exposure across countries. AEs face higher exposure than EMs due to a higher adoption of AI technologies. The authors also find that the impact of AI on employment varies across countries, with some experiencing a decline in employment and others experiencing an increase. The paper concludes that the distributional implications of AI on labor markets are significant and vary across countries.
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