AI Delivers Zero Payoff to Corporate America Outside Tech, Apollo Economist Says

Well, of course not. If you borrow a trillion dollars to build a 1¢ aspirin machine to compete with $1 generic aspirin, you are strongly incentivized to sell your aspirin for 99¢. We don’t see productivity gains, because approximately all of the gain is captured as revenue for AI companies.

It’s weird that this has to be spelled out for so many engineers and economists, but to be very clear: OpenAI et al wants your token spend to go to one-minus-epsilon of what you previously spent on payroll, and wants your productivity to go to one-plus-epsilon of what it previously was. If you want 10x productivity, spend 9.9x more on tokens.

They are in the business of enclosure and rent extraction, and any innovation that comes out of their research and development - regardless of how real an innovation it is - will be completely contained and bent totally towards that business. Any leakage of the innovation that you experience as a productivity boost is literally felt as lost profits by them.

I don't see why a payoff would have appeared yet. Many (but certainly not all) software companies have increased their output without hiring more people. But having software with more features doesn't necessarily drive immediate productivity gains in the rest of the economy. It will take time for those benefits to percolate. We've only had access to models good enough to majorly accelerate code writing since early-2026. I feel like we're in the very beginnings of the first part of this wave.

For sake of comparison, consider e-commerce. As a proxy for "impact on the economy", we can use Amazon's revenue. They went public in 1997 and that year had revenue of $148M (just 0.14% of Walmart's revenue that year). By 2000, revenue was $2.76B (1.65% of Walmart). Bricks and mortar didn't start feeling anything until probably 2011, when Amazon crossed 11% of Walmart's revenue. And it wasn't until 2025 that Amazon finally surpassed Walmart.

But, if you worked in tech in the e-commerce business, things were already feeling pretty hot by 2007. And at that point in time, the e-commerce sector was still miniscule compared to traditional retail (~4%). Software is very exciting these days and the most fantastic things are happening. They will eventually percolate out to the rest of the economy. But it will take many years before everyone notices the difference.

"You can see the computer age everywhere but in the productivity statistics." -- 1987

One industry example.. We have been giving students computing devices for years with the cost of educating students going up year after year.. Yet scores keep dropping.. No productivity gains here.. I do not think these results are unique to the education sector.. There are probably alot of businesses where nothing much will change except slight efficiencies.. not enough to move the needle..

We can use a non-deterministic system because we have test suites that act as validation gates.

Other industries don't, so they have no way of knowing if the AI is bullshitting them outside of manual validation, which makes it more expensive and slower than doing it yourself.

"AI does not understand accountability, trust, culture, unwritten rules, ethical trade-offs or fairness, all of which shape reputational risk and ultimately drive revenue growth and profit margins."

For a sec I thought he was talking about private equity.

I think what people fail to appreciate, is that past a certain size, organizations and the people within them get so tightly wrapped up in working a certain way that it becomes nearly impossible to fix without rebuilding the whole thing from the ground up.

If you want to see if AI is paying off, look at new startups that build AI-native versus those that don't, controlling for the type of industry/product. This is a difficult causal inference comparison to make, but it's the one that I find most meaningful and interesting.

The problem with this analysis is twofold.

1. Even before AI, the U.S. economy was growing because of a handful of tech companies. The rest of the companies were collapsing.

2. If revenue per worker is stagnant despite AI investment, we don’t know what the revenue per worker would be without AI investment.

3. There’s no reason to believe AI should improve revenue. AI doesn’t just make companies more efficient. It makes their customers more capable of replacing their products. This continues all the way down to the individual. I might have thought about buying a calories tracking app in the past, but now, I can just use one of my AI Chat apps to do that for me.

AI might be reducing overall demand for services and therefore naturally contracting the exchange based economic system.

Anecdotally this is not true. At $JOB I'm responsible for running the accounting function of a small US public company. With tools like OMP and shortcut my team has been able to significantly reduce the time it takes to prepare internal and public reporting documents. Not only are we getting more done within tighter deadlines, I have also observed a dramatic increase in the quality of the work product (not least in the form of fewer audit findings).

Maybe it takes a while to show up on the S&P 493's bottom line, but our token spend has had one of the best ROI as far as I'm concerned.