The Macroeconomic Effect of AI: Sizing the Software Engineering Channel (NBER WP 35793)
National Bureau of Economic Research
Blumenfeld, Hazell, Lian and Schaab measure how AI affects the economy through one channel: software engineering productivity. They build a forward-looking, real-time measure from financial markets, estimating each firm's stock-return sensitivity to an AI stock market index and how it varies with the share of firm payroll in software engineering, then use a model to map that relationship into productivity gains. The period studied is November 2022 to December 2025.