Andy Mukherjee: The AI productivity boom has begun-if you know where to find it

Something similar is going on now. In less than four years since the first large language model was released, annual AI investment is approaching $1 trillion. Yet, where is the evidence that firms using AI are getting more juice out of their human resources, leading to economy-wide gains?

A recent paper by Alex Blumenfeld at the University of California, Berkeley, with Jonathon Hazell at the London School of Economics and two other economists, has tried to fill the gap by putting a number on one crucial area where AI is having the most impact: software engineering.

Suppose there are two e-commerce platforms, but only one is redesigning its app so that Claude or ChatGPT agents can shop as effortlessly as humans. Before long, its job listings will be seeking more software developers skilled at using AI to complete projects faster than was previously possible.

Stock markets already have some sense of which firms are making the best use of AI. As the tech advances, investors will increasingly price the expected gains into the shares of those best placed to profit from it.

The researchers compare firms’ stock returns with an AI Index, with other factors constant, then examine how the returns vary with spending on programmers’ pay. The result was striking: Between November 2022 and December 2025, AI raised the market’s estimate of the present value of software-engineering productivity by the equivalent of a permanent 32.6% increase.

To arrive at their findings, Blumenfeld et al studied companies ranging from online marketplaces like eBay to electronics firms and travel platforms like Airbnb.

What they have in common is that software engineering is key to their businesses, rather than being the product itself. To differentiate AI’s effect on productivity, the researchers excluded software companies and firms in the semiconductor supply chain.

The same pattern appears to hold true for some of Asia’s biggest consumer companies. I ran a back-of-the-envelope test, measuring the sensitivity of the US-listed shares of Sony, Coupang and Grab to the Robo Global Artificial Intelligence Index, and comparing the result against their software engineering exposure.

Without access to payroll data, I used the share of software-related vacancies on company careers pages as a proxy. Think of it as a peek under the hood. A statistical investigation into AI’s productivity gains across Asian companies will need a much broader sample than three handpicked ones. Still, the trio offers a suggestive glimpse.

Coupang is South Korea’s answer to Amazon; Grab is a Southeast Asian super-app. Sony, a global powerhouse spanning hardware, gaming and Hollywood, defies easy analysis. My model excluded a senior technical program manager for PlayStation from the ranks of coders. Yet, the job description says the role touches every phase of the software-development life cycle. Such cases suggest Sony’s actual exposure to software engineering may be considerably higher than my 12% estimate.

Glitches like this may help explain why we keep underestimating AI’s productivity gains. Improvements will emerge in roles and corners of firms that no one is watching closely. By the time they become obvious, businesses may already be operating very differently. Even my crude exercise points in the same direction as the more rigorous Blumenfeld study: Software development is where the efficiency story is unfolding first.

The same effect should, in theory, be visible at Chinese tech giants. Alibaba illustrates why it can be hard to spot. The company’s shares move sharply to everything from US semiconductor export restrictions to competition in cloud computing from rivals such as ByteDance’s Douyin, distorting the stock’s relationship with the AI index. But failure to isolate productivity gains doesn’t mean that they don’t exist.

“Software is eating the world,” Marc Andreessen wrote in 2011. He was right. Technology and tech-adjacent companies now account for roughly 95% of the market capitalization of the world’s 10 largest businesses. But software itself is undergoing another revolution. Until now, every line of code had to be written by a human. No longer. “When agents write 90% of the code, engineers can literally do 10 times as much,” Andreessen noted recently.

Official stats may not have caught up yet, but stock prices and job ads suggest the productivity boom has begun. ©Bloomberg

The author is a Bloomberg Opinion columnist covering industrial companies and financial services in Asia.