Vanderbilt researcher outlines recession scenario from AI spending bubble collapse

Asad Ramzanali from Vanderbilt Policy Accelerator released a peer-reviewed paper analyzing how an artificial intelligence spending crash could trigger a broader recession. The paper models economic cascades from AI sector contraction and proposes policy interventions to prevent or mitigate damage. This matters because AI investment now represents a material portion of US capital spending and equity valuations; a sector-wide correction could ripple through employment, lending, and consumer confidence. The analysis suggests policymakers have a narrow window to implement safeguards before market conditions tighten.