McKinsey: $50 trillion of value to be created by AI and Robotics through 2025
To better understand the likely social impact of AI and Robotics, it’s very useful to have an estimate of the economic gains they will create in the near future. The respected consulting firm McKinsey & Company recently released the report: “Disruptive technologies: Advances that will transform life, business, and the global economy”. The report estimates the likely economic impact of 12 disruptive technologies ten years from now in 2025.
To get a better sense of the scale of the forces involved, I wanted a single number that would summarize the economic impact of just AI and Robotics over the next 10 years. I took the 5 technologies that could be considered “AI and Robotics” and their ranges in “trillions of dollars of impact annually”:
- Automation of knowledge work: $5.2-6.7 trillion
- Internet of things: $2.7-6.2 trillion
- Advanced robotics: $1.7-4.5 trillion
- Autonomous and near-autonomous vehicles: $.2-1.9 trillion
- 3D printing: $.2-.6 trillion
Adding those up in 2025 we get a total range of impact for 2025 of $10-19.9 trillion. To get the total economic impact for the 10 years from 2015 to 2025 we need to estimate how fast these technologies will ramp up. The simplest model is linear starting from $0 and ramping up to the 2025 level. This is something of an underestimate because the current impact is not $0, but something of an overestimate because it neglects the convexity of the growth curve. The linear approximation is just 10 times the 2025 impact divided by 2 and gives a range of:
- Total impact to 2025: $50-99.5 trillion
To account for the approximations, I use the low end of this range, i.e. $50 trillion, as a reasonable summary of the scale of the likely impact.