Economist Anton Korinek Explains How AI Automation Pushes Cognitive Wages Down

akorinek · x · 2026-09-11

Economist Anton Korinek explains the mechanism in his research: wages adjust down only gradually (Blanchard–Galí style), so actual wages stay above clearing levels, firms employ fewer cognitive workers, and laid-off workers transition slowly. The key point: AI automation pushes the clearing wage for cognitive jobs down relative to other wages — firms cut employment, but the target is falling, not rising. Details in Section 2.3 of his paper.

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