Thomas Le Barbanchon How can traditional AI improve search and matching? Evidence from 59 million personalized job recommendations Abstract: We explore how Artificial Intelligence can be leveraged to help frictional markets to clear. We design a collaborative-filtering machine-learning job recommender system that uses job seekers' click history to generate relevant personalized job recommendations. We deploy it at scale on the largest online job board in Sweden, and design a clustered two-sided randomized experiment to evaluate its impact on job search and labor-market outcomes. Combining platform data with unemployment and employment registers, we find that treated job seekers are more likely to click and apply to recommended jobs, and have 0.6\% higher employment within the 6 months following first exposure to recommendations. At the job-worker pair level, we document that recommending a vacancy to a job seeker increases the probability to work at this workplace by 5\%. Leveraging the two-sided vacancy-worker randomization or the market-level randomization, we find limited congestion effects. We find that employment effects are larger for workers that are less-educated, unemployed, and have initially a large geographic scope of search, for jobs that are attached to several jobs, and are relatively older. Results also suggest that recommendations expanding the occupational scope yield higher effects.

Kaushik Basu Outline of a New Theory of Labor, with Mutating Goods Abstract: The standard model of microeconomics treats labor as an unwanted, time-consuming activity that one would not indulge in but for the income that this generates. We have generally presumed that the demand for this kind of labor will exist as long as we do. However, in the age of Artificial Intelligence, with rapidly advancing technology, the question is beginning to arise about what will happen when the demand for this kind of labor vanishes. This paper argues that the time has come to rethink the meaning and foundations of ‘labor’ and goes on to sketch a microeconomic model in which the status of the same time-consuming activity can mutate between ‘labor’ and consumption. A partial equilibrium model is built to illustrate how these mutations can occur because of exogenous changes. Thereafter, a simple, general-equilibrium model with mutating goods is described. This can provide a framework for future research. The model is then used to discuss new kinds of policy interventions that a government may want to design and implement in the new world of vanishing conventional labor.