ARTIFICIAL INTELLIGENCE AND WORKFORCE PARTICIPATION IN PAKISTAN: LINEAR AND NON-LINEAR ANALYSIS

Abstract

The present study analyses the influence of artificial intelligence (AI) on work force participation (WFP) in Pakistan for the period 1995 to 2024. The proxy of AI is represented through the variable of AI-related patent applications while other relevant variables involve gross domestic product (GDP) growth, gross fixed capital formation (GFCF), inflation and research & development (R&D). Impact of AI on work force participation is identified by using the Autoregressive Distributed Lag (ARDL) model. The Non-linear ARDL (NARDL) model is also adopted for analyzing the different outcomes of rises and falls in AI. The results of the ARDL as well as the NARDL methods show the impact of AI on work force participation both in the short and long term. The results also indicate that the effect of AI does not significantly differ in the case of rises and falls.