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It can, but it's entirely up to the developer. I remember writing about his in the UNITY thread, and I've been really disappointed in how they've failed to use hardware advances to really evolve gaming in the 7th and 8th gen, especially when it comes to interactivity and AI and less use of scripted events and waypoints.

There is still so much to be explored in gaming, but seemingly so few willing to actually explore it. And with budgets being what they are and huge conglomerate publishers owning most developers in some form or other, it's really hard to see the mainstream moving in any dramatic (literally, when it comes to writing) direction any time soon.