Artificial Intelligence and the Digital Economy: Impact on Employment, Productivity, and Market Structures

Abstract

This paper presents a Systematic Literature Review (SLR) examining the economic impact of artificial intelligence (AI) on employment, productivity, and market structures within the digital economy. Following the PRISMA protocol, 78 peer-reviewed studies and institutional reports (2015–2025) were synthesized. The literature consistently reveals that AI produces a dual labor market effect - displacing routine occupations while generating new AI-complementary roles - with net positive but unequally distributed employment outcomes. Productivity gains are significant at the firm level but contingent on complementary organizational investment and show delayed aggregate effects. AI also intensifies market concentration, reinforcing winner-takes-most competitive dynamics through data-driven network effects. Policy implications span labor transition, competition regulation, and digital governance.