Implications of Your AI Advisor in Economic Decision-making

Economic Theory of AI Advisors

Overview

Artificial intelligence (AI) applications, especially large-language models (LLMs), continue to proliferate. Not only do many individuals now report making frequent use of LLMs in their work, but government agencies and large investment firms are increasingly relying on the advice of AI in their decision making. Ongoing research from Professors Karapandža and Nyarko investigates the “advisor” role of these AI tools and the resulting implications for financial and industrial organization. Drawing on theories of political science and economic rationality, their work is expanding the frontier of knowledge regarding the uses, and limitations, of AI for guiding decision making.

  • Create a Model for Understanding the Behavior of Large Language Models

  • Validate AI-guided Economic Decisions

  • Identify Paradoxes that can Result Even from Purely Rational Inputs

  • Help Define the Use Cases for AI to Improve Livelihoods

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