Savings Limit the Automation Boom

Automation’s theoretical growth potential depends not only on technical progress but on who puts up the capital: if households or institutions do not raise the saving/investment rate, the realized growth from machines can be a fraction of the modelled maximum. The paper shows quantitatively that with a fixed 2025 U.S. saving rate (23%) the modeled automation boom shrinks dramatically and that bond yields spike as markets price a temporary growth surge. — If correct, policy should focus on mobilizing and directing capital (public investment, pension funds, incentives) and on distributional safety nets, because failing to do so turns a technological opportunity into stagnation and harms low‑savings households.