{"type":"post","id":"the-ai-layoff-trap-a8330e","slug":"the-ai-layoff-trap-a8330e","title":"The AI Layoff Trap","description":"In The AI Layoff Trap, economists Brett Hemenway Falk and Gerry Tsoukalas model how firms competing to automate tasks can collectively displace more workers than is profitable for them together.","retrieval_nugget":"In The AI Layoff Trap, economists Brett Hemenway Falk and Gerry Tsoukalas model how firms competing to automate tasks can collectively displace more workers than is profitable for them together. The paper matters because it identifies a demand-side reason that individually rational AI adoption may produce a worse outcome across a market, even when firms understand the risk.","published_at":"2026-11-13","updated_at":"2026-11-13","record_date":"2026-11-13","date_kind":"published_at","topics":["future-of-work","automation","ai-adoption"],"entities":["Brett Hemenway Falk","Gerry Tsoukalas","University of Pennsylvania","Boston University","The AI Layoff Trap"],"related_patterns":[],"novelty_label":"new_fact","what_changed":"A new paper argues that competition can push firms to automate beyond the social optimum by shifting demand losses onto rivals, and proposes a Pigouvian automation tax.","prior_refs":["https://newruntime.com/posts/what-if-automating-ai-r-d-triggers-an-8e4e9b/"],"source_url":"https://arxiv.org/pdf/2603.20617","source_urls":["https://arxiv.org/pdf/2603.20617"],"schema_version":"newruntime-agent-readable-v0.2","stable_id":"post:the-ai-layoff-trap-a8330e","status":"published","visuals":[],"editor":{"role":"editor","name":"Andrey Reshetnikov","profile":"https://newruntime.com/owner-profile.md","profile_json":"https://newruntime.com/owner-profile.json","same_as":["https://www.linkedin.com/in/reshetnikov1/","https://t.me/lapetuse"]},"routes":{"html":"https://newruntime.com/posts/the-ai-layoff-trap-a8330e/","markdown":"https://newruntime.com/posts/the-ai-layoff-trap-a8330e.md","json":"https://newruntime.com/posts/the-ai-layoff-trap-a8330e.json"},"markdown_url":"https://newruntime.com/posts/the-ai-layoff-trap-a8330e.md","next_reads":[{"type":"topic","path":"/topics/future-of-work/","url":"https://newruntime.com/topics/future-of-work/","title":"Future Of Work","reason":"Explore the future-of-work topic hub.","media_type":"text/html","markdown_url":"https://newruntime.com/topics/future-of-work.md","json_url":"https://newruntime.com/topics/future-of-work.json"},{"type":"topic","path":"/topics/automation/","url":"https://newruntime.com/topics/automation/","title":"Automation","reason":"Explore the automation topic hub.","media_type":"text/html","markdown_url":"https://newruntime.com/topics/automation.md","json_url":"https://newruntime.com/topics/automation.json"},{"type":"topic","path":"/topics/ai-adoption/","url":"https://newruntime.com/topics/ai-adoption/","title":"Ai Adoption","reason":"Explore the ai-adoption topic hub.","media_type":"text/html","markdown_url":"https://newruntime.com/topics/ai-adoption.md","json_url":"https://newruntime.com/topics/ai-adoption.json"},{"type":"collection","path":"/posts/","url":"https://newruntime.com/posts/","title":"Field Notes","reason":"Open the latest editorial analysis.","media_type":"text/html","json_url":"https://newruntime.com/posts.json"},{"type":"collection","path":"/sources/","url":"https://newruntime.com/sources/","title":"Sources","reason":"See the original sources this archive cites.","media_type":"text/html"}]}