AI and Immunity to the COVID-19 Pandemic
By Abhishek Bhatia, Nikhil Madan, Deepa Mani, Shekhar Tomar
Citation
Bhatia, Abhishek., Madan, Nikhil., Mani, Deepa., Tomar, Shekhar. (2024). AI and Immunity to the COVID-19 Pandemic .
Copyright
2024
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Abstract
We evaluate economic immunity to the COVID-19 pandemic accorded by a sector’s exposure to AI. We use an event study design, which causally estimates the impact of AI industry exposure (AIIE) on shifts in economic activity following the first pandemic-induced lockdown in India. Using payments data from one of India’s largest payment gateways, we find that a one-standard-deviation increase in AIIE arrests the pandemic-engendered decline in industry payments by a third. High AIIE of downstream sectors further improves a sector’s economic resilience, emphasizing the importance of downstream supply chain partners in technology adoption and change. We also uncover mechanisms underlying the observed impact of AI on economic activity. Notably, we observe an association between firm-level AI investments and superior information capabilities prior to the pandemic that arguably enable agility and responsiveness, resulting in greater business continuity during the lockdown. We additionally find evidence that AI-enabled adaptation during the pandemic complemented labor rather than displacing it. Our results advance an understanding of the role of AI in according resilience during crises and have important implications for managers and policymakers.

Nikhil Madan is an Assistant Professor of Organisational Behaviour at the Indian School of Business (ISB).He holds a PhD in Organisational Behaviour from INSEAD, an MS in Quantitative Economics from the Indian Statistical Institute, and a Bachelor’s degree in Economics from the University of Delhi.

Professor Madan's research has been published in leading outlets such as Journal of Experimental Social Psychology, Organizational Behavior and Human Decision Processes, Organization Science, and Harvard Business Review. He teaches negotiation and decision-making at ISB.

Nikhil Madan
Nikhil Madan

Professor Deepa Mani is Professor of Information Systems and the Deputy Dean of Academic Programmes & Digital Learning at the Indian School of Business. Deepa’s research interests are at the intersection of technology, organisation, and society. She has demonstrated significant thought leadership on the business and policy implications of technological innovations and investments. Her research articles have been published in leading academic journals and extensively featured in refereed conference proceedings, edited book chapters, and popular media outlets. Deepa serves as a Senior Editor at Information Systems Research. Deepa’s research has also had widespread impact on business practice and policy. In recognition of her impact, she was awarded the prestigious INFORMS Information Systems Society (ISS) Practical Impacts Award in 2022.

Deepa has been appointed to serve on several expert committees of the Central and State governments to provide guidance on policies for the digital economy, digital interventions in key sectors, and catalyse grassroot impacts using technology. She also extensively coaches organizations, keynotes corporate leadership events, and conducts executive education in the areas of digital business models, digital transformation and technology product management.

Deepa completed her undergraduate education at St. Stephen’s College, Delhi University, Masters in Information Systems from Carnegie Mellon University, Pennsylvania, and her doctorate in Information Systems from the University of Texas, Austin.

Deepa Mani (1)
Deepa Mani

Shekhar Tomar is an Assistant Professor of Economics and Public Policy at the Indian School of Business (ISB). He completed his PhD from the Toulouse School of Economics in 2017 and worked as a Research Economist at the Reserve Bank of India (RBI) between 2017 and 2019. His research lies at the intersection of macroeconomics, trade, and finance, and he extensively uses micro-data to answer macroeconomic questions in his work. During his stint at the RBI, he regularly contributed to policy work on monetary policy and trade issues in India.

Shekhar Tomar
Shekhar Tomar