Welcome to the week! The holidays are fast approaching and I hope everyone is ready for turkey. Meta announced their participation in the Lantern program only for it to the immediately overshadowed by documents released in the Massachusetts’ lawsuit. Plus, AI continues to live rent free in our nation’s collective mind.
Public Comments
How should agencies use AI? If you have opinions on the matter (as I’m sure you do) now is the time to share them. The OMB is seeking comment on their memorandum that “would establish new agency requirements in areas of AI governance, innovation, and risk management, and would direct agencies to adopt specific minimum risk management practices for uses of AI that impact the rights and safety of the public.”
Comments close December 5th.
In the News
Children’s Safety Online
‘Meta’s Deception’ About Instagram’s Harmful Qualities Alleged in Massachusetts Suit | Georgia Wells and Jeff Horwitz, Wall Street Journal
Meta’s Zuckerberg ‘Ignored’ Executives on Kids Safety, Lawsuit Says | Cristiano Lima and Naomi Nix
A Coasean Analysis of Online Age-Verification and Parental-Consent Regimes | Ben Sperry, ICLE
It’s Not Kids With the Cellphone Problem, It’s Parents | Pamela Paul, New York Times
Artificial Intelligence
Recent Hearings on AI
The Philosophy of AI: Learning From History, Shaping Our Future | Committee on Homeland Security & Governmental Affairs
Advances in Deepfake Technology | United States House Committee on Oversight and Accountability
Unpacking the Executive Order on AI | William Rinehart, Exformation
What Might Good AI Policy Look Like? Four Principles for a Light Touch Approach to Artificial Intelligence | Jennifer Huddleston, Cato
Sens. Warner, Moran Introduce Legislation to Establish AI Guidelines for Federal Government
Senators Push to Give Biden’s AI Order More Teeth | Rebecca Kern and Brendan Bordelon, Politico
Meta to Require Political Advertisers to Disclose Use of A.I. | Mike Isaac, New York Times
Antitrust and the Market
Gatekeeping, the DMA, and the Future of Competition Regulation | Lazar Radic, Truth on the Market
Google and Microsoft Are Fighting Again | Miles Kruppa and Tom Dotan, Wall Street Journal
Research
The A.I. Dilemma: Growth versus Existential Risk
Advances in artificial intelligence (A.I.) are a double-edged sword. On the one hand, they may increase economic growth as A.I. augments our ability to innovate. On the other hand, many experts worry that these advances entail existential risk: creating a superintelligence misaligned with human values could lead to catastrophic outcomes, even possibly human extinction. This paper considers the optimal use of A.I. technology in the presence of these opportunities and risks. Under what conditions should we continue the rapid progress of A.I. and under what conditions should we stop?
The Impact of Fake Reviews on Demand and Welfare
Although fake online customer reviews have become prevalent on platforms such as Amazon, Google, and Facebook, little is known about how these reviews influence consumer behavior. This paper provides the first experimental estimates of the effects of fake reviews on individual demand and welfare. We conduct an incentive-compatible online experiment with a nationally representative sample of respondents from the United Kingdom (n = 10,000). Consumers are asked to choose a product category, browse a platform resembling Amazon, and select one of five equally priced products. One of the products is of inferior quality, one is of superior quality, and three are of average quality. We randomly allocate participants to variants of the platform: five treatment groups see positive fake reviews for an inferior product, and the control group does not see fake reviews. Moreover, some participants are randomly selected to receive an educational intervention that aims to mitigate the potential effects of fake reviews. Our analysis of the experimental data yields four findings. First, fake reviews make consumers more likely to choose lower-quality products. Second, we estimate that welfare losses from such reviews may be important—on the order of $.12 for each dollar spent in the setting we study. Third, we find that fake reviews have heterogeneous effects. For example, the effect of fake reviews is smaller for those who do not trust customer reviews. Fake reviews also have larger effects on those who shop online more frequently. Fourth, we show that the educational intervention reduces the adverse welfare impact of fake reviews by 44%.
Data and Polling
Survey: Growing AI Concerns Among U.S. Adults | Morning Consult and Axios