We often talk about AI as a Silicon Valley phenomenon, but the economics of AI is a Caribbean story too. It’s about more than just chatbots; it is about a general-purpose technology that is fundamentally shifting how we value labour, productivity, and even regional data sovereignty. International Economist, Dr Justin Ram, joins us once again and shares his thoughts on: the factors he uses to determine the impact of AI on an economy; the impact of AI on our services sector, and the opportunities emerging thanks to AI; the potential for AI to widen the digital and socio-economic divide; and whether AI is an existential threat to Caribbean economies.
This episode is also available on SoundCloud, Apple Podcasts, Spotify and Amazon Music.
For over a century, the primary drivers of economic expansion were physical capital and human labour. Today, a third pillar has emerged: Artificial Intelligence (AI). The ‘economics of AI’ is fundamentally the study of how the plummeting cost of prediction and the automation of cognitive tasks are restructuring the global value chain. Unlike previous technological shifts, AI does not just replace a hand on a lever; it augments or replaces the decision-making process behind the lever.
As AI continues to evolve and becomes even more accessible, the stakes for developing countries have moved beyond simple adoption. We are now witnessing a global race to define who owns the data, who controls the compute, and who reaps the productivity dividends of a world where ‘intelligence’ is a scalable, on-demand utility.
In a nutshell, the “economics of AI” is no longer a niche academic interest. It is the study of how a new form of digital capital—intelligence itself—reprogrammes not only the global marketplace but also our societies.
Introducing our guest
Dr Justin Ram is a Development Economist with 30 years of international experience in 34 countries spanning the Caribbean, Africa, Latin America, Central Asia, and Europe. He possesses practical, advisory, research, and management experience and has worked for several governments and many multilateral agencies, including the International Monetary Fund, the World Bank, the Inter-American Development Bank, Caribbean Community (CARICOM) agencies, including the Caribbean Development Bank, numerous United Nations agencies, as well as for private and public sector firms. Most recently, he was the Programme Director and Lead Advisor to the Premier for the National Delivery Unit in the Turks and Caicos Islands Government (TCIG) and was responsible for operationalising a Delivery Unit in TCIG and implementing the government’s priority projects and policies.
Justin combines strategic leadership with technical expertise in economic policy, institutional reform, resilience finance, and sustainable development. He is a recognised thought leader in development economics, Caribbean Economics in micro, small and medium enterprise (MSME) development, trade and digital economy, climate and resilience finance, and social inclusion. He has a Diploma in Executive Management from Stanford University and a PhD from the London School of Economics and Political Science
Insights into our conversation
With all the current attention on AI, it appears that Caribbean countries have not yet comprehensively explored the implications of AI for our economies, and, more so, there have been limited public conversations on the issue. Much of the focus has been on improvements in individual productivity, potential savings for organisations, the testing challenges being experienced in schools, and the need for school curricula to now address AI. Although all these areas—and many more—are important for us to consider, it appears that we are overlooking the proverbial elephant in the room: the impact of AI on our economies, which made this conversation with Justing even more important.
However, the approach Justin took was unexpected but welcomed. Instead of exploring the typical economic concepts such as supply and demand, labour, productivity, investment, trade, imports and exports, he challenged us to adopt a bottom-up approach and start with the individual and their wellbeing.
Justin is of the view that the economic model that the region has adopted has not necessarily served our countries well. More importantly, as AI and other emerging technologies take hold, there is the opportunity to essentially establish a new economic paradigm that would allow our countries—and citizens—to thrive.
Below are the questions that drove our conversation with Justin.
- To start us off, as an Economist, what is meant by the term “the economics of AI” and what factors would you be examining to determine the impact of AI on an economy?
- Most Caribbean economies are services-based. With AI automating global back-office tasks, do you see this as a threat to our ‘nearshoring’ industry, or an opportunity to move up the value chain?
- Is there a risk that AI accelerates a “two-speed” Caribbean — where workers in digitally connected urban areas adapt, and rural or poorer communities fall further behind?
- If AI is the new ‘general purpose technology,’ should Caribbean governments be subsidising AI literacy, or should we focus on fixing the underlying ‘digital divide’ in internet access first?
- With global AI investment concentrated in the US and China, how can Caribbean nations ensure they aren’t just ‘consumers’ of AI, paying out rent to foreign tech giants without seeing local economic returns?
- Should Caribbean governments be building their own AI infrastructure, or is it more realistic to negotiate better terms with large platforms?
- How should Caribbean regulators balance the need for innovation with the protection of local data—what some call ‘data sovereignty’?
- Should Caribbean countries consider AI an existential threat to their economies?
We would love to hear your thoughts!
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Select links
Below are links to some of the organisations and resources that either were mentioned during the episode, or otherwise, might be useful
Images credit: J Ram; wirestock (Freepik); Frolopiaton Palm (Freepik); federcap (Freepik)
Music credit: The Last Word (Oui Ma Chérie), by Andy Narrell
Podcast editing support: Mayra Bonilla Lopez
