ArticleBrett Hemenway Falk, Gerry TsoukalasResearch
The study outlines a fundamental coordination failure: even when executives recognise that AI layoffs erode the consumer purchasing power sustaining their industries, individual competitive pressures compel them to cut labor anyway.
Falk and Tsoukalas examine AI adoption as a prisoner's dilemma rather than a technological inevitability. Because an individual company cannot internalise the macroeconomic demand drop caused by its own layoffs, inaction guarantees elimination by competitors. The paper emphasizes that post-displacement safety nets or retraining do not alter competitive cost incentives, making pre-emptive policy measures such as Pigouvian automation taxes theoretically necessary to align private incentives with macroeconomic stability.
Summary generated by AI (Gemini 3.8 Flash, 27 September 2026). It may contain errors – the original source is authoritative.
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