TonyBai

May 4, 2026 · Industry Insights

How AI Could Lead Us All into a Double‑Loss Trap, According to a New Academic Paper

A recent economics paper models AI‑driven layoffs as a prisoner's‑dilemma competition that pushes firms into an over‑automation arms race, ultimately collapsing both corporate profits and workers' incomes, and evaluates why common remedies like UBI or upskilling fail while proposing an automation tax as the only viable brake.