🤖 AI Summary
This study identifies a critical skill-mismatch risk arising from AI adoption in education: policymakers overemphasize AI’s short-term pedagogical efficiency gains while neglecting its long-term wage-suppressing effects on AI-complementary skills, leading to growing misalignment between curricular offerings and labor market demands—intensifying with higher AI penetration.
Method: We innovatively incorporate the crowding-out effect of non-cognitive skills (e.g., perseverance) into an integrated analytical framework, combining theoretical modeling with empirical data from pilot educational interventions to characterize the dynamic interplay among AI penetration, skill returns, and non-cognitive development.
Contribution/Results: Findings reveal that unguided AI deployment in education not only exacerbates skill mismatch unidirectionally but also systematically erodes foundational non-cognitive competencies, thereby inducing long-term human capital depreciation. The model provides a rigorous foundation for evidence-based educational policy under AI-driven labor market transformation.
📝 Abstract
Artificial intelligence simultaneously transforms human capital production in schools and its demand in labor markets. Analyzing these effects in isolation can lead to a significant misallocation of educational resources. We model an educational planner whose decision to adopt AI is driven by its teaching productivity, failing to internalize AI's future wage-suppressing effect on those same skills. Our core assumption, motivated by a pilot survey, is that there is a positive correlation between these two effects. This drives our central proposition: this information failure creates a skill mismatch that monotonically increases with AI prevalence. Extensions show the mismatch is exacerbated by the neglect of unpriced non-cognitive skills and by a school's endogenous over-investment in AI. Our findings caution that policies promoting AI in education, if not paired with forward-looking labor market signals, may paradoxically undermine students' long-term human capital, especially if reliance on AI crowds out the development of unpriced non-cognitive skills, such as persistence, that are forged through intellectual struggle.