Discussions about AI frequently center on technological issues, lost in buzzwords and arcana that may relate to “how” questions, but do much to obscure the “why” and “what” questions. In a thoughtful new book, Prediction Machines, Ajay Agrawal and colleagues at the University of Toronto provide a much needed antidote to the overhyped AI discussion that dominates most forums. The authors use classic principles from economics to demystify why AI is on the rise, what it means for leaders, businesses, and industries, and how organizations can derive more value from it. Their ideas have important implications for HR, which we discuss in this article.