• A
  • A
  • A
  • ABC
  • ABC
  • ABC
  • А
  • А
  • А
  • А
  • А
Regular version of the site

‘AI Will Apply to All Activities, Having a Great Effect on Economy’

‘AI Will Apply to All Activities, Having a Great Effect on Economy’

© iStock

Artificial Intelligence (AI) has become a fundamental component of many activities in economics and finance in recent years. On April 26, Panos Pardalos, Academic Supervisor at the Laboratory of Algorithms and Technologies for Networks Analysis (LATNA at HSE Nizhny Novgorod) and Distinguished Professor of Industrial and Systems Engineering at the University of Florida, will talk about its impact, future developments and limitations in his honorary lecture Artificial Intelligence (AI) in Economics and Finance.



Panos Pardalos

Professor Pardalos started the LATNA laboratory with a mega-grant in 2011 and has been awarded the medal 'Recognition — for contribution to science and education'. Today, the laboratory is a recognized international centre carrying out research in the field of computer science and its applications.

AI As the Field of Fields

We know today that technology enhances our activities. We can see better with microscopes, we can sense better with sensors, and we can compute faster with computers. And AI is a tool for all these things. A lot of science fiction was based on it. However, now AI is so important that it is a nationally prioritized issue in many countries, such as the United States, China, Europe, Canada.

We see that the number of patents in the AI has increased a lot. China has been number one for the last few years in terms of the number of patents. AI as a technology is like electricity. If you asked Edison about the impact of electricity in the society, he would have said it is the field of the fields—it is that important. Now, AI is s the field of the fields. It has an impact in every aspect of life, especially, the economy, because of the impact in production. If we look at automation—what would we do today without electronics?

Machine learning is another tool —it is also essential for AI and data analysis today. Then there is also the blockchain technology. Blockchain is a good thing, but AI and blockchain together are used for transactions in the systems that are organized globally. Most importantly, it is a national security issue. AI is involved everywhere—we use expert systems and machine learning. AI is used to describe machines performing human-like cognitive tasks. It has been used for the last 10-15 years, and there is a huge competition among different countries, which is very important, because competition drives a lot of things.

Predicting the Economic Failures

In my talk, I will discuss the general importance of AI in finance and economics. Then I will focus on more specific examples, on some things that I have done with my students.

During my years in Russia, I’ve tried to analyse the dynamics of financial markets. And in fact, for the first time, we did an analysis of the Russian stock market. That was a difficult task, because the data was very difficult to get

We analysed the Russian stock market along with many other emerging markets, particularly the BRICS ones. You cannot ignore these countries, because they have huge populations, huge consumer power, and it is very important to see what the effects of globalization are.

We use sensitive machine-learning ideas to predict economic failures. Sometimes you see the stock market clashes nobody predicted. After a clash happens, people develop techniques and say ‘oh, we can predict it’. But this is called ‘a posteriori analysis’ — after it happened. It is a useful study, but it’s good to know whether we can predict the future. It’s not easy.

Using AI in Financial Report Analysis

In my talk at the April Conference I’ll examine some different issues that have to do with companies, their annual reports, and the impact of what is called ‘mirror computing’, which is a new type of thinking in computing. It is not entirely new as it has been around for some time, but now it has become more successful.

The main problem is how to get data. The regulations in many countries force the companies to make their annual reports public. Sometimes companies cut and paste from the previous year. But if this is the case, how will the company make decisions? How can it understand what the performance of the company is? Sometimes those who make the reports are reluctant to modify them and to see what has really been done but the investor must have a good idea about what is going on. There must be prosperity, but in a business, it is not always the case.

Performing textual analysis of financial reports is not easy. This is a huge report with a lot of data and you must use very fast techniques so we had to find techniques to mine this data.

We developed a neural network for this analysis. It can apply to any companies, not only banks, but others as well, such as gas companies or energy companies.

AI Taking Centre Stage

Wherever we did the analysis on the Russian stock market, we found out that ten dominant stock companies are banking and energy, not high-tech, while as we can see in the United States, the dominant companies are information technology companies, like Google, Apple and Microsoft. In other countries like Brazil, there is more food production, whereas China is a manufacturer.

But now China is developing. They announced in 2017 a national plan, where they put a lot of funding to make China number one in AI. AI will apply to all the activities, which means it will have a great effect on the economy, especially in manufacturing. AI techniques will be much more efficient. Nobody will be able to compete with China. Europe, United States and Canada realize that.

This is like a new Sputnik effect. Soviet Union went to space first, which motivated America to start the National Science Foundation. So, they start funding NASA and they went to the Moon. But I think it’s good.

However, every tool can be used in different ways. AI can be used in weapons. The key issue is that AI is a major technology that affects economies. AI is even used to make fake news. Our goal is to harness AI for the good of the global economy.

Honorary lecture will be delivered on April 26, at 5.15 pm (GMT +3)

See also:

Russia Remains a Partner for Foreign Scientists

The XXII April International Academic Conference on Economic and Social Development is drawing to a close in Moscow. In an interview with the media partner of the event, NEWS.ru, HSE University Vice Rector Ivan Prostakov spoke about how the format of the conference was organized, how the pandemic impacted the event, and how scientists and experts from different countries regard Russia.

Human Capital, Innovation, and Fintech: What the Future Holds for Eurasian Integration

To what extent do the countries of the Eurasian Economic Union (EAEU) benefit from an open economy? What financial, scientific, and educational policy tools will contribute to the implementation of the recently approved ‘Strategic Directions for the Development of Eurasian Economic integration until 2025’? These questions were discussed by participants in a series of expert discussions at the XXII April International Academic Conference on Economic and Social Development organised by HSE University and Sberbank.

Assessment of Universal Competences: New Approaches to Assessing Soft Skills

In order to remain competitive in the labour market, university graduates must be proficient not only in professional knowledge and skills, but also in a set of universal competences (UC). However, higher education systems face problems in assessing such competences due to a lack of developed approaches and methodologies. A report released by the HSE Institute of Education, ‘An Assessment of Universal Competences as Higher Education Learning Outcomes’, analyses the ways in which these challenges have been addressed in both Russia and abroad.

What Can Make Robots More Human-like?

What is affect and why is it important for humans? How can feelings be defined and what is their relation to emotions and consciousness? What might be used in making a soft robot? Professor Antonio Damasio (University of Southern California, USA) discussed these and other questions in his honorary lecture, entitled 'Feeling, Knowing, and Artificial Intelligence'.The talk was delivered on April 16 at the at the XXII April International Academic Conference held by HSE University jointly with Sberbank.

World Bank Forecasts a Rise in Poverty

General wealth levels in Eastern Europe and Central Asia have been improving since 2012 — poverty has been decreasing. But due to COVID, global poverty levels, including those of these regions, may increase considerably for the first time in two decades. Samuel Freije-Rodriguez, Lead Economist at World Bank, talked about this at the XXII April Conference organized by HSE University and Sberbank.

Globalization Endures: Global Trade and the Economy Are Showing Signs of Recovery

The global economy’s pace of recovery after the pandemic largely depends on whether consumers will return to a hedonic style of consumption. At the XXII April International Academic Conference, organized by the HSE and Sberbank, the HSE School of World Economy held a round table ‘The World Economy in the Context of the Coronavirus Pandemic’.

‘No One Can Say We’re Going to Replace Old People with Machines’

Experts believe that increasing productivity, diversifying the economy, as well as developing human capital and expanding non-resource exports will help boost Russia's economic growth. But the state policy has to be smart. This was discussed at a series of round tables and expert discussions on the topic of productivity at the XXII April International Academic Conference on Economic and Social Development, organised by HSE University and Sberbank.

The Pandemic Requires Breakthrough Solutions from Us

From April 13 to 30, HSE University is hosting the XXII April International Academic Conference on Economic and Social Development, one of the most important annual events in Russian humanities. Profile talked to Lev Jakobson, co-chair of the conference organising committee and vice president of HSE University, about the challenges that researchers face today.

Living in an Age of Change: Understanding Digital Exclusion

The competition for promising young researchers is intensifying around the world, and spending on preparing future generations of highly qualified specialists is on the rise. This is happening against a backdrop of digitalisation, which is creating a new digital inequality. For example, a quarter of the adult population in Russia does not possess any digital skills and does not use the Internet. These and other topics were discussed by participants of a round table held during the XXII April International Academic Conference on Economic and Social Development organised by HSE University and Sberbank.

HSE April International Participants Conference to Discuss Global and National Challenges

The Human Capital Multidisciplinary Research Centre will organize a series of presentations and roundtable discussions as part of theXXII HSE April Conference, which will take place from April 13 to 30, 2021.