When adopting a performance-enhancing technology offers short-run relative advantages, competitive pressure can drive diffusion even if most adopters would prefer a collective ban. We study this dynamic in the context of unrestricted AI tools for teenagers’ education. In preregistered, incentive-compatible experiments with approximately 2,000 parents in the United States, Canada, and the United Kingdom, we elicit willingness to pay for a three-month premium subscription to a leading general-purpose AI platform. Demand increases steeply with the share of other teenagers using AI: Moving perceived peer take-up from 20% to 80% raises willingness to pay by more than 60%. We then test whether information about emerging evidence on potential downstream skill effects changes behavior. Risk information substantially shifts incentivized beliefs about longer-run impacts but has little effect on individual demand, yet it strongly increases support for school-level restrictions. Follow-up experiments show that peer-adoption information does not significantly shift perceived AI quality, the importance parents assign to core skills, or support for bans, pointing to social pressure rather than social learning as the primary channel. The results reveal a rat-race dynamic in which individual adoption responds to peers even as collective preferences shift toward restriction.
Keywords:
AI; education; rat race; social pressure; technology adoption.
