“AI Could Undermine Emerging Economies” by Deric Cheng

Update: 2025-12-11

Description

Earlier this year, Anthropic CEO Dario Amodei warned that powerful AI could render upwards of 50% of white-collar jobs redundant, with the impact concentrated on entry-level jobs. If these predictions hold true, it could imply a long-term crisis of skill acquisition. Without the training ground of a first job, young workers could be denied the experiences and networks necessary to enter white-collar work. Their career trajectories could be severed before they begin.

AI is likely to disrupt more than the professional trajectories of individuals. The threat to career development mirrors a broader geoeconomic threat AI poses to developing countries: just as young workers need entry-level roles to climb into more senior roles, developing nations need viable “entry-level” industries to develop their human capital and ascend the global economic development ladder.

The Development Ladder

Many economies have followed a similar path for development over the past several decades. The most reproducible strategy has traced a familiar sequence: moving from low-skill agrarian production, to building a globally competitive manufacturing base, and eventually to exporting higher-value services and technology.

Such a progression is often described as a development ladder — a series of rungs that countries climb as they accumulate the capital [...]

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Outline:

(01:02 ) The Development Ladder

(04:55 ) The Evolution of Export-Driven Development

(06:48 ) Transformative AI Threatens Export-Driven Development

(07:58 ) First, AI could prevent leapfrogging via digital services.

(10:17 ) Second, AI-driven automation could raise capital requirements beyond the reach of developing countries.

(12:41 ) Third, AI-driven automation could disrupt the learning-by-exporting dynamic.

(14:25 ) Diminishing Leverage for Developing Countries

(18:29 ) Discussion about this post

(18:32 ) Ready for more?