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Chapter 11 in Democracy in the era of Artificial Intelligence: Opportunities and Risks
Abstract
AI has gained significant influence in shaping economic systems, environmental governance, and policies on climate changes in developed and developing countries. The present research paper will discuss the economic aspects of the impact of AI in relation to climate change, exploring the contradictory influence of AI on the environment due to its ability to increase environmental sustainability and at the same time promote the growth of energy consumption for running digital infrastructures and performing computational operations. The research is carried out using a qualitative approach to research based on secondary data obtained from various reports, policy documents, and scientific literature on the topics of environmental economics, governance, and digital transformation. The research concludes that AI produces a double externality, as it helps reduce greenhouse gas emissions through optimization, forecasting, and effective resource allocation, but also adds to environmental stress as a result of the rising need for electricity in data centers and AI systems.