Authors: Dr. Rajeshwar Prasad
Abstract: Total Factor Productivity (TFP) is a fundamental driver of long-term economic growth, capturing efficiency gains beyond labor and capital accumulation. In recent years, Artificial Intelligence (AI) has emerged as a general-purpose technology capable of transforming production processes, decision-making systems, and innovation dynamics across economies. This paper examines the role of AI in enhancing TFP using a conceptual-analytical framework supported by empirical evidence from India and OECD economies. The study analyzes sectoral impacts of AI across manufacturing, agriculture, services, and the public sector, and presents productivity indicators derived from national and international sources. The findings indicate a positive association between AI adoption and productivity growth, conditional on complementary investments in human capital, digital infrastructure, and institutional quality. The paper concludes with policy implications for developing economies, emphasizing inclusive and sustainable AI-driven productivity growth.
DOI: https://doi.org/10.5281/zenodo.18326462