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Artificial Intelligence and business: the opportunities and costs of a revolution

  • Milan
  • 20 November 2023

        Artificial Intelligence (AI) is generating a revolution capable of changing forms of power and the structure of knowledge. The extent of those changes makes it difficult to predict scenarios and to construct a political, economic, social and legislative framework that can channel them toward development and prosperity.

        The legislative challenge has already been undertaken, with varying results, by some of the bigger players on the field; by executive order of the Biden administration, the United States has chosen a co-regulatory approach in dialogue with industry, while China has maintained its managerial vision. Located in-between is Europe, which has reaffirmed its regulatory paradigm, even as it exposes itself to the paradox of wanting to regulate what it does not produce and what it cannot control.

        Moreover, it is impossible not to see how, given the new international scenario forming around technological predominance, the Old Continent could have been consigned to such a marginal role, far from that of the balance point that France, for example, would like it to have. Overly concerned about its own internal challenges, the EU has lost competitiveness and has not got an investment capacity comparable to that of China and the US, not least for lack of a community-wide industrial policy. The choice of leaving that aspect up to individual country members by loosening the discipline of State Aid is increasing the continent’s weakness precisely as the other side of the Atlantic shifts paradigm, enshrining economic efficiency as a national security principle.

        Europe is fragmented on markets such as that of AI, conditioned by scale economies on data and highly energy-dependent, and risks losing additional terrain due to rising energy costs. In addition to the domestic challenges of individual countries, beginning with governance of this particular sector, is the need to identify independent authorities that can properly manage it without hindering development. Some success stories, like that of France, show that Europe does have a chance at recovery in this continually evolving sector. But that calls for a coherent industrial policy aimed at stimulating investments and innovation and at the same time making data available to fuel development. With its current political fragmentation and investments remaining below the European average, Italy must not resign itself to taking a subordinate role; it has the power to act at the level of technological application thanks to its industrial excellences. The key is to use technology to minimize the costs of industrial development through the use of digital twins, which make it possible to proceed by trial and error, thus minimizing timeframes and costs. In any case, digital twins have noteworthy fields of application, starting with that of healthcare, where they are contributing to the development of personalized medicine.

        These examples are proof that AI can, in the immediate future, have a truly significant impact on the daily lives of citizens. By revolutionizing the structure of knowledge, AI will play an enormous role in overhauling various social and economic ambits, starting with the work paradigm. The changes foreseen will be rapid and epoch-making, with the emergence of some totally new occupations and the substantial evolution of many current ones where, within a short time, half of a worker’s time could be spent flanked by artificial intelligence.  Managing such a revolution will require deep adjustments to the educational system, from the earliest school years onward; but also of business culture, starting with that of small and medium-sized firms that are still, in many cases, not yet up to speed with these new applications. The very perception of work is also going to change; while in the past industrial automation replaced many manual tasks, now the roles most affected will be white-collar ones. The global political challenge is going to be to use AI not to replace manpower but to free up creative potential by alleviating the weight of the most routine tasks.

        Of all the social effects of AI, not to be underestimated, moreover, is the impact it has on the formation of public opinion and on the dissemination of information. The crisis in the traditional media and their intermediary function, and the spread of social platforms as sources of information, are increasing the risks of society’s polarization. And the simultaneous spread of false news risks triggering a vicious cycle in which AI floods the web with the same dangerous content it ends up feeding itself on.

        AI poses many challenges, but it is also pivotal to the future of societies, and democracies in particular. Understanding its breadth is the first step toward navigating the changes and exploiting the enormous potential of this technology, in the interests of and for the benefit of the community as a whole.

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