Generative AI and Finance

Abstract

Since ChatGPT's release in 2022, demand for artificial intelligence (AI)–related skills in finance has grown rapidly, as generative AI drives significant technological changes in both the financial research field and the broader economy. We show that financial occupations are highly exposed to the productivity effects of generative AI, review the literature on the impact of ChatGPT on firm value, and provide directions for future research investigating the impact of this major technology shock. Generative AI also holds great potential as a tool for finance researchers and practitioners: We review and describe innovations in research methods linked to improvements in AI tools, along with their applications. We offer a practical introduction to available tools and advice for researchers in academia and industry interested in using these tools.