But new research from Brookings, authored by Ben Harris, Neil R. Mehrotra and William Overcash, suggests that while AI-driven economic growth might meaningfully shrink fiscal deficits, it is still unlikely to bridge the gap “even in more optimistic scenarios fully.”
The suggestion that AI could be the silver bullet for a fiscal crisis is understandable, the trio writes, owing to the active capital expenditure into the transformative technology thus far, as well as “the unharnessed capacity of the technology to boost productivity.”
Indeed, AI investment has continued at such a pace this year that it’s taking even Wall Street analysts by surprise. For example, BNP Paribas lifted its near-term U.S. GDP growth estimates earlier this year on the back of capex announcements indicating a larger impulse from the AI buildout than the banking giant had expected. While they estimated that growth for all of 2026 will stay the same at 2.6%, the markets team highlighted that on a Q4/Q4 comparison of this year to last, growth would be 2.6% rather than the 2.1% previously estimated.
Likewise, AI—even in its early years of testing and adoption—seems to be having an impact on output. A June study from The Centre for Economic Policy Research (CEPR) found that the implied measure of AI-attributed labor productivity growth (derived from revenues and employment) for 2026 is 1.8%—gains are expected to be highest in high-skill services and finance, where they exceed 2%.
