When It Comes to Investing, Is A. I. Worth the Hype?

A. I. bots are joy, maybe even helpful and, until recently, endowed with the amazing ability to enchant traders and fuel the U. S. property market.

But the outstanding performance of a new, relatively inexpensive artificial intelligence website from a Chinese start-up, , has perturbed the market and complicated the A. I. history.

Investors are re-evaluating prominent companies swept up in A. I. fever, including , , Alphabet, Microsoft, Amazon, Tesla and the private start-up OpenAI. The notion that full-blown superhuman intelligence is imminent has spurred the-sky-is-the-limit valuations, as well as concerns about the political and social posed by advanced intelligence.

One quick question is: If similar outcomes can be achieved much more cheaply, is the main approach to developing A. I. in the United States worth the investment for all companies? DeepSeek’s lower-cost innovations add urgency to bigger, longstanding financial questions: How much are artificial intelligence companies really worth, and what will the broader economic value of A. I. ultimately be?

Daron Acemoglu, a winner of the 2024 Nobel in economic science, gave me some answers. ” There is a lot of hype in the industry”, he told me in a telephone conversation. Yes, he said, A. I.companies have made some “impressive achievements”, but he added that many financial and economic calculations were being based on mere “projections into the future that are sometimes exaggerated”.

Professor Acemoglu, an M. I. T. economist with an interest in the impact of technical innovations on global economics, is skeptical about the more fervent A. I. claims. He ranks A. I. as a significant advance, perhaps with a macroeconomic effect akin to the telephone, which was no small thing.