AI and Geoeconomics

Thomas C. Schelling Thomas C. Schelling (1921–2016) was an American economist and professor known for his ground-breaking work on game theory and its application to conflict, cooperation, and international security. He was awarded the Nobel Memorial Prize in Economic Sciences in 2005 for “having enhanced our understanding of conflict and cooperation through game-theory analysis.” Schelling’s influential books, particularly “The Strategy of Conflict” (1960) and “Micromotives and Macrobehavior” (1978), introduced key concepts such as focal points, credible commitments, and the “tipping point” phenomenon, profoundly shaping fields like international relations, nuclear strategy, and even social dynamics. Theory of Conflict Thomas Schelling in “Theory of Conflict” wrote: TACIT COORDINATION (COMMON INTERESTS) When a man loses his wife in a department store without any prior understanding on where to meet if they get separated, the chances are good that they will find each other. It is likely...

Paris, February 12th, 2025 - AI Summit - session organized by Project Syndicate Daron Acemoglu, Nobel Laureate in Economics and Institute Professor of Economics at MIT Jean-Noël Barrot, Minister for Europe and Foreign Affairs of France Daron Acemoglu, Nobel Prize-winning economist, discusses the dual nature of technology in his AI Summit talk. While technology has historically improved health, comfort, and prosperity, it can also be misused, and its development doesn't always align with optimal social outcomes. Acemoglu argues that the key challenge is shifting AI development toward benefiting workers and empowering citizens with control over their data. He envisions a future where 80% of AI researchers prioritize these goals, which he believes would solve many current issues. However, achieving this shift won't be easy due to financial incentives, ideological constraints, and power structures. He suggests that progress will require changes in norms, institutions, regulations, ...

  This summary highlights key insights from the NBER Working Paper titled "The Political Economy of Geoeconomic Power" by Christopher Clayton, Matteo Maggiori, and Jesse Schreger. The paper examines how great powers leverage economic and financial capabilities to achieve geopolitical objectives—a phenomenon known as "geoeconomics." It explores domestic political and economic factors shaping a government's capacity to exert such influence globally. We hope this overview offers a thought-provoking perspective on the intersection of economics and geopolitics. Key Arguments on the Rise of Geoeconomics: Definition and Scope: Geoeconomics involves the strategic use of economic tools—such as sanctions, export controls, and supply chain manipulation—to achieve geopolitical aims, influencing both domestic and foreign business dynamics. Economic Strength vs. Geoeconomic Power: A nation's economic size forms the basis of geoeconomic influence, but effective power r...