CommsDay Story of the Week – from CommsDay, Wednesday 18 March 2026
Artificial Intelligence (AI) is attracting a lot of attention in the media and elsewhere – and so it should be, given its potentially transformative impact on individuals, society and the economy. TelSoc has facilitated discussion on all aspects of AI, including this week with our AI webinar presented by Professor Geoff Webb from Monash University. (See Events page of the website for detail and for Geoff’s presentation slides). This week we have chosen an article from Wednesday’s CommsDay, reporting on a thought-provoking lecture recently delivered on the broader impact of AI, particularly on economic thinking and economic reporting, by Andrew Leigh, MP, the Commonwealth Assistant Minister for Productivity.
Leigh says AI reshaping economic assumptions beyond productivity
Assistant minister for productivity Andrew Leigh said artificial intelligence is forcing economists to revisit core assumptions underpinning modern economic analysis, arguing the technology should be seen not only as a productivity driver but as an “informational shock” that alters how markets interpret behaviour.
Delivering the 2026 Ted Evans Lecture in Brisbane, Leigh said: “Much of the public discussion treats AI primarily as a productivity story. That framing is not mistaken… But for economists, there’s more at stake.”
“The claim I want to defend this evening is that artificial intelligence is both a productivity shock and an informational shock,” he said. “It increases what economies can produce while also weakening many of the signals economists rely upon to interpret behaviour.”
Leigh said standard economic proxies may become less reliable as AI adoption scales. “Output has long served as a proxy for effort. Credentials have signalled skill. Prices have conveyed scarcity. Choices have revealed preferences,” he said. “If those signals become noisier, manipulable, or partially synthetic, then some of our most familiar theories might need up-dating.”
On production, Leigh said economists may need to move beyond treating technology as a single productivity factor, arguing AI operates at the level of tasks rather than whole industries. “Technology may need to be modelled less as a scalar and more as a high-dimensional vector of task productivities,” he said, pointing to “bottlenecked production systems” in which output is constrained by the hardest-to-automate task.
“In such an environment… the macroeconomic effects of AI depend disproportionately on which tasks remain scarce rather than on average productivity gains.”
Leigh said AI may also disrupt traditional models of labour markets built around skill-biased technical change, with some forms of cognition no longer scarce.
“AI differs in that it begins to automate aspects of non-routine cognitive work… activities once regarded as the preserve of highly educated workers,” he said. “Such skills were scarce in the old model… Now, AI makes them abundant.”
He said this could shift labour market returns toward “judgement versus execution, oversight versus production”, adding that “inequality may have less to do with years of education and more to do with whether someone occupies a judgement-intensive role.”
Leigh also argued that AI is weakening the link between education and capability measurement, particularly in universities. “Artificial intelligence upsets that premise by allowing individuals to execute complex tasks without fully internalising the underlying capabilities,” he said.
“AI has killed take-home assessment… Human capital theory has always relied on an implicit equivalence: doing implies knowing. AI dissolves that equivalence.”
On firms and contracting, Leigh said AI agents introduce “a new type of delegate” in economic relationships. “With software agents, the principal-agent problem is less about shirking, and more about accurate execution of the principal’s preferences,” he said. “The main design problem isn’t motivating behaviour, it’s specifying goals.”
He said similar shifts were emerging in professional services, where AI is reducing the scarcity of information but not responsibility.
“AI changes what is scarce. Information becomes plentiful, but responsibility remains scarce,” Leigh said. “A person must still sign the audit… or issue the ruling.”
Leigh also warned that AI may complicate welfare analysis by shaping preferences rather than simply revealing them. “When preferences are endogenous to the decision environment, policy evaluation that relies solely on observed choices risks conflating influence with welfare,” he said.
On innovation, Leigh said AI could shift the constraint from generating ideas to selecting between them. “The result may be that the scarcity is not in generating ideas, but in exercising judgement over which ideas are worth pursuing,” he said. “If AI makes ideas abundant, does the central constraint… shift from discovery to selection?”
He added that trade theory may also need updating as cognitive capability becomes more accessible globally via software rather than being tied to national skill bases.
Closing the speech, Leigh said AI requires economists to rethink how signals are formed and interpreted across the economy.
“Artificial intelligence is not just increasing what economies can produce; it is altering the informational environment in which economic activity is interpreted,” he said.
“The task is not to jettison these intellectual achievements, but to recognise when their assumptions no longer match the structure of the real economy.”
Grahame Lynch
IN TODAY’S COMMSDAY (Friday 20 March 2026)
FIRST: The Australian Communications and Media Authority has signalled a pivotal phase for spectrum policy, today releasing a draft five-year outlook that brings expiring mobile licences, direct-to-device satellite services and early 6G planning onto a single planning agenda.
FIRST: Shadow communications minister senator Sarah Henderson has described the federal government’s review of Triple Zero legislation and regulation as a “staggering admission of failure”, arguing the process is too slow and lacks immediate remedies.
Optus has secured the mantle of best mobile network in Ookla’s Speedtest Connectivity Report for Australia for the second half of 2025.
NBN Co has raised $850 million from its first ever domestic sustainability bond, to help fund green and social projects.
EXCLUSIVE: auDA chief executive Dr Bruce Tonkin used the 40th anniversary of the .au domain to argue that Australia’s internet namespace is moving into a new phase where its future value will rest less on simple web addressing and more on trust, identity and resilience in an AI-driven internet.
EXCLUSIVE: Sydney-based fabless semiconductor vendor Morse Micro has positioned Wi-Fi HaLow as an entry point into a broader strategy targeting wireless IoT and edge artificial intelligence, with chief executive and co-founder Michael De Nil outlining ambitions to build a globally competitive chip business.
New Zealand’s data centre sector is attracting a surge of investment as it shifts from what Venture Insights described as a geographically isolated digital terminus to a strategic transit hub, with hyperscale demand underpinning a sharp expansion in capacity.
Global bandwidth demand exceeded 6.4 petabits per second in 2024, growing at a 32% compound annual rate between 2020 and 2024, according to TeleGeography’s latest State of the Network report, with hyperscale content and cloud providers accounting for the bulk of consumption.
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