6 AI’s Political Impact: Reshaping Power Within and Across Countries Main messages • AI is changing power dynamics between countries, corporations, and citizens, amplifying existing power imbalances and creating new ones. • AI offers developing countries a real opportunity to transform their economies and societies, but geopolitical constraints, misaligned incentives, and intentional misuse of the technology may result in harm. • Developing countries’ access to AI infrastructure is dependent on geopolitics; however, pursuing “AI sovereignty” is expensive and not always effective. • Generous incentives to attract AI investment may strain government resources, while the unanticipated use of state power and close ties between governments and AI firms could reduce the public benefits of such investment. • Network effects and data feedback loops allow global AI companies to derive more value from user data than users themselves. AI also allows dominant firms—in the AI industry and beyond—as large employers to set terms in which wages are depressed, working conditions are diminished, and workers have limited ability to bargain. • AI enables surveillance and the spread of propaganda in the absence of institutional checks and balances. Introduction In a quiet office in the capital of a developing country, Minister Maya faces a decision that will shape her country’s technological future. Two proposals written by her advisers sit on her desk. One involves acquiring the latest artificial intelligence (AI) chips, the leading models, and cloud services from a small group of leading AI economies. The other involves her country building its own chips, models, and data centers. The first proposal enables her country to quickly acquire the capabilities of AI but risks her country becoming overly dependent on foreign providers. 201