The economic impact of artificial intelligence: evidence from Italian firms

We study the adoption of artificial intelligence (AI) technologies among Italian firms and their effects on firm–level outcomes, using newly collected survey data linked to administrative balance sheet and employer–employee records. We document that, as of 2024, AI adoption remains limited: about 10 per cent of firms report current use, while nearly 30 per cent plan to adopt AI within the next two years. Adoption is concentrated among larger and more knowledge-intensive firms, as well as among firms with higher labour costs, pointing to the importance of organizational capacity, technological complementarities and efficiency considerations. Using a difference-in-differences framework, we show that AI adoption increases labour productivity and profitability, and leads to a reallocation of employment toward higher-skilled occupations through a statistically significant expansion of white-collar employment and a contraction of blue-collar employment, with no detectable effects on overall employment. Finally, we examine firms' expectations and find that AI-adopting firms anticipate smaller increases in their own prices and lower medium- to long-term inflation than non-adopters. These patterns suggest that AI adoption is associated with expected efficiency gains that shape both firms' pricing behaviour and their macroeconomic expectations.