--- title: "AI, Skill, and Productivity: The Case of Taxi Drivers · AI Fault Line" url: https://aifaultline.com/research/p/doi-10-1287-mnsc-2023-01631/ description: "AI Fault Line is a neutral, evidence-cited field guide to why experts looking at the same developments disagree about AI's effect on productivity, jobs, inequality, regulation and the pace of change." --- [Research](https://aifaultline.com/research/) # AI, Skill, and Productivity: The Case of Taxi Drivers Kyogo Kanazawa, Daiji Kawaguchi, Hitoshi Shigeoka, Yasutora Watanabe · Management Science · 9 Jun 2025 [Read original source](https://doi.org/10.1287/mnsc.2023.01631) Where this sits in the debate - [Will AI actually boost productivity and growth?](https://aifaultline.com/debate/productivity/) · its finding: it depends ([why studies differ](https://aifaultline.com/debate/productivity/#why)) - [Will AI widen inequality?](https://aifaultline.com/debate/inequality/) · its finding goes against the claim ([why studies differ](https://aifaultline.com/debate/inequality/#why)) Direction of the finding as read from the abstract by an AI model ([AI-written](https://aifaultline.com/about/)). ## Abstract We examine the impact of artificial intelligence (AI) on productivity in the context of taxi drivers. The AI we study assists drivers with finding customers by suggesting routes along which the demand is predicted to be high. We find that AI improves drivers’ productivity by shortening the cruising time, and this gain is accrued only to low-skilled drivers, narrowing the productivity gap between high- and low-skilled drivers by 13.4%. This case study provides evidence that AI and skill are indeed substitutes, offering direct support for the underlying assumption of recent projection exercises regarding job displacement by AI. This paper was accepted by Joshua Gans, business strategy. Funding: This work was supported by the JSPS KAKENHI [Grants 23K25495, 23H00828, 22H00847, 22H05009, and 22H00057], JST RISTEX [Grant JPMJRX18H3], and JST ERATO [Grant JPMJER2301]. Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2023.01631 . ## About this publication **Leading field journal.** A leading journal in economics or a neighbouring field (on the Tinbergen Institute’s A list or near the top of the RePEc ranking), or a top-rated computer-science venue. Placed by: Leading field journal. [How sources are ranked](https://aifaultline.com/about/#source-ranking). Published 2025 (17 months ago) Citations 19 (OpenAlex) ## Citations in context [Chart: 19 citations, cohort median 10] 19 citations — 73rd percentile among the 33 indexed papers from 2025 in this collection. Citation counts favor older papers; this compares only same-year papers here, not the whole literature. [Chart: published 2025] □ added to this collection in 2026. ## More on this topic Related by theme, not necessarily by method or conclusion. - [The Effects of Generative AI on High Skilled Work: Evidence from Three Field Experiments with Software Developers](https://aifaultline.com/research/p/doi-10-2139-ssrn-4945566/) SSRN · 2024 - [GPTs are GPTs: An Early Look at the Labor Market Impact Potential of Large Language Models](https://aifaultline.com/research/p/doi-10-48550-arxiv-2303-10130/) arXiv · 2023 - [Extending “GPTs Are GPTs” to Firms](https://aifaultline.com/research/p/doi-10-1257-pandp-20251045/) AEA Papers and Proceedings · 2025 - [New Frontiers: The Origins and Content of New Work, 1940–2018](https://aifaultline.com/research/p/doi-10-1093-qje-qjae008/) The Quarterly Journal of Economics · 2024 Overview assembled automatically from collected metadata. [How this site is built](https://aifaultline.com/about/).