India, Nov. 15 -- The lack of a macroeconomic model for Artificial Intelligence (AI) makes it a double-edged sword for nations, Nobel Prize winning economist Joseph Stiglitz said at the Hindustan Times Leadership summit on Saturday, while cautioning that countries like India should increase investments in education to mitigate the potential impact it could have on employment.

According to Stiglitz, the ongoing AI boom has generated two key challenges for the global economy. The first is whether the investments in AI will lead to expected returns, which in turn would determine if it creates a financial sector bubble that would eventually burst. The second and more important challenge is striking a balance between the gainers and losers wh...