We study the use and economic impact of AI technologies among U.S. firms. We propose
a new measure of firm-level AI investments, using a unique combination of worker resume and job postings datasets. Our measure reveals a stark increase in AI investments across sectors. AI-investing firms see increased growth in sales, employment, and market valuations. This growth comes primarily through increased product innovation, reflected in trademarks, product patents, and product updates. AI-powered growth concentrates among ex-ante larger firms, leading to higher industry concentration and reinforcing winner-take-most dynamics.
Our results highlight that new technologies can contribute to growth through product innova-
For more information, please visit the Stern Finance website or contact Lindsay Anderson.