Renowned economist Paul Krugman, a Nobel laureate, suggested that artificial intelligence resembles the dot-com bubble but could have a very different outcome. Krugman highlighted the stars of the Magnificent Seven as the stars of AI and pointed out Silicon Valley’s return to the political arena. The technology world is turning its focus towards artificial intelligence, with investments exceeding $900 billion expected by 2027. The rapid development of AI is also on the agenda of globally recognized economists. In a publication on Substack, Krugman pointed out that the dizzying valuations of some technology stocks and the mass excitement about the future are reminiscent of the dot-com bubble. Krugman stated that, despite the artificial intelligence fever resembling the dot-com bubble, the end of the game could be quite different. “NEW TECHNOLOGY IS STRENGTHENING HIERARCHY” According to Krugman, in the dot-com crisis of the 2000s, investors expected newly established companies to become highly profitable quasi-monopolies. The renowned economist indicated that the Magnificent Seven led the way to artificial intelligence. Emphasizing the tendency of significant technologies to disrupt the market hierarchy historically, Krugman used the phrase, “This time, investors expect the radical new technology (AI) to strengthen the hierarchy.” The technology giants known as the Magnificent Seven include Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. HIGHLIGHTING CHANGES IN SILICON VALLEY Krugman also drew attention to the changes in Silicon Valley by stating, “A quarter of a century ago, Silicon Valley had largely disconnected from politics. Now, major tech leaders like Jeff Bezos and Mark Zuckerberg have close ties to the government.” The US technology index, Nasdaq 100, has surged by over 80% since the launch of ChatGPT in late 2022. Analysts are expecting further increases in the market this year.