Radio Davos AI may spark a new era of progress, but that depends on more than just the tech
Mar 5, 2026
Carl Benedikt Frey, an Oxford economic historian who studies automation and the future of work, discusses how institutions shape whether AI becomes a force for broad progress. He covers institutional bottlenecks, regulation favoring incumbents, the end of the scaling era, geopolitics fragmenting innovation, and what Europe and emerging economies must change to benefit from AI.
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Technology Needs Institutional Complements
- Technology alone doesn't guarantee broad gains in productivity.
- Carl Benedikt Frey shows computers and the internet increased research scope but diluted attention, so scholars did more projects instead of deeper breakthroughs.
Regulate AI Without Locking Out New Entrants
- Balance regulation so it mitigates AI risks without imposing compliance costs that favor incumbents.
- Frey warns pharma‑style heavy regulation would leave only a few firms able to compete and give them outsized power.
Concentration Favors Automation Over Invention
- Market concentration steers AI toward automation rather than novel industries.
- Large firms use AI to optimize existing processes while smaller firms are likelier to create entirely new products and sectors.
