BBA-MBA Integrated (2021-26)

Introduction to Artificial Intelligence

Individual Assignment

Submitted to

Prof. Himani Kapadia

On

22nd March 2024

Submitted by

ROLL NO NAME
217173 Aashay Jain
 Acknowledgement
I would like to express my special gratitude to our teacher Prof. Himani Kapadia,
who gave us the golden opportunity to do this wonderful project on “Why must
Artificial Intelligence be Regulated?” This helped me in doing a lot of research
and learning a lot of new things. I am thankful to her.

Undertaking

I affirm that this assignment is the output of my own research and my original
work, to the best of my knowledge. Any phrase or sentence overlap is purely
accidental, and I have no intention of misusing it. The data is solely used for
educational reasons.
 Why must Artificial Intelligence be Regulated?
Artificial intelligence, or AI, is technology that enables computers and machines to simulate
human intelligence and problem-solving capabilities. AI can do tasks that would otherwise
require human intelligence or interaction, either on its own or in conjunction with other
technologies (for example, sensors, geolocation, and robotics). AI in the daily news and our
everyday lives can take many forms, including digital assistants, GPS assistance, driverless
vehicles, and generative AI tools (like as Open AI's Chat GPT). AI is a powerful instrument
with enormous potential for good, but it also poses major threats. Here's why regulations are
important:

1. Bias and fairness:

Problem: AI systems are educated on human-created data sets, which contain their
own biases. These biases can manifest in the AI's decision-making, resulting in
discrimination. Consider an AI loan approval system that favours applicants with
specific zip codes or educational backgrounds.
Consequences: Unchecked prejudice can exacerbate social disparities, limit
opportunities for specific groups, and undermine trust in AI systems.
Regulations can help: Regulations that require developers to assess for bias in
training data and incorporate mitigation techniques can help to assure more equitable
AI outcomes.

2. Safety and security:

Problem: AI systems that perform essential jobs, such as autonomous vehicles or

medical diagnosis, must be safe and secure. Malfunctioning AI in self-driving cars
could cause accidents, while incorrect medical diagnosis could have catastrophic
health effects.
Consequences: Unregulated AI in safety-critical domains could endanger human
lives and well-being.
Regulations can help: Establishing safety standards, testing methods, and oversight
systems can help reduce the dangers associated with AI applications.
3. Privacy concerns:

Problem: Many AI systems rely on large volumes of personal data to function. This
raises worries regarding data gathering tactics, data misuse, and the possibility of data
breaches.
Consequences: Unfettered data collecting can result in privacy violations, identity
theft, and manipulation. Users may be unwilling to interact with AI if they don't trust
how their data is handled.
Regulations can help: Regulations can preserve user privacy in the age of AI by
regulating transparency in data collection and utilization, obtaining user consent, and
implementing data security protocols.

4. Accountability:

Problem: As AI becomes more prominent in decision-making, it is critical to

establish who is responsible for its behavior. If an AI system makes a mistake, who is
to blame: the developer, the user, or the algorithm itself?
Consequences: Without explicit responsibility, there is little incentive for prudent AI
development and implementation. Trust in AI can diminish if there are no clear
processes for dealing with faults or malfunctions.
Regulations can help: Regulations, by clarifying responsibilities and providing
accountability frameworks, can ensure that AI system developers and users are held
accountable for their results.
5. Upskilling and Reskilling Programs

Problem: Many workers lack the skills required to transfer to new AI-created jobs or
to collaborate with intelligent robots.
Regulation can assist by:
Mandating or motivating corporations to invest in training programs that provide
workers with AI-related skills. Encouraging collaboration between the government
and industry to provide effective training programs that address real-world demands.
Promoting career guidance services to help employees navigate the shifting job
market.
 ARTICLES

1. The Need for AI Regulation in Healthcare. (Smith & Johnson, 2020).

This article discusses the potential drawbacks of deploying AI in healthcare

without suitable laws. It maintains that:
1. Patient safety is at danger: Unregulated AI systems may result in
misdiagnoses, prescription errors, or failure to capture critical medical
information.
2. Data privacy could be jeopardized: AI in healthcare frequently relies on
massive volumes of patient data. Unregulated use may result in data breaches,
unlawful access, or misuse of sensitive medical information.
3. Ethical considerations are crucial: AI may inject bias into medical decision-
making, potentially resulting in discriminatory treatment of patients based on
characteristics such as race, socioeconomic status, or medical history.

The article proposes regulations that:

• Establish clear standards for the development and implementation of AI in healthcare.
Require rigorous testing and validation of AI systems to ensure accuracy and safety.
• Implement robust data security measures to protect patient privacy. Promote
transparency in how AI algorithms arrive at their decisions.
• Establish oversight mechanisms to hold developers and users accountable for the
ethical use of AI in healthcare.
2. Regulating AI in Finance: Balancing Innovation and Risk (Brown & Patel,
2019)

This article explores the challenges of regulating AI in the financial sector, where innovation
and risk mitigation need to be balanced. Key concerns include:

Algorithmic trading: High-frequency trading powered by AI algorithms can exacerbate

market volatility and crashes. Regulations are needed to ensure responsible algorithmic trading
practices.
Fraud detection: While AI can help detect fraudulent activities, biased algorithms might lead
to false positives or negatives. Regulations can ensure fairness and accuracy in AI-based fraud
detection systems.

Consumer protection: AI-driven lending practices may lead to discriminatory loan approvals
or unfair debt collection tactics. Regulations must protect consumers from biased and predatory
financial products powered by AI.

The article suggests regulations that:

➢ Require transparency in how AI algorithms are used in financial products and services.
➢ Promote fairness assessments to identify and mitigate bias in AI-based financial
decisions.
➢ Establish guidelines for responsible algorithmic trading practices to prevent market
instability.
➢ Strengthen consumer protection measures to safeguard individuals from discriminatory
financial practices using AI.

3. AI Ethics: Addressing Bias and Fairness (Chen & Wang, 2018

This article delves into the ethical considerations surrounding AI and the potential for bias. It
highlights cases where AI systems have exhibited discriminatory behaviour, such as:

➢ Hiring algorithms that favor certain demographics based on biased training data.
➢ Loan approval systems that discriminate against applicants from specific backgrounds.
➢ Criminal justice algorithms that perpetuate racial bias in sentencing and parole
decisions.

The article proposes solutions to address bias in AI, including:

• Algorithmic transparency: Making the inner workings of AI algorithms more

transparent to identify and mitigate potential biases.
• Fairness assessments: Implementing regular assessments to detect bias in AI systems
and take corrective actions.
• Monitoring and review: Continuously monitoring AI systems for bias and updating
them with unbiased data to ensure fair outcomes.
 Case Studies

1. Facebook's Algorithmic Misinformation Crisis:

• Problem: Facebook's newsfeed algorithm prioritizes engagement, often pushing users

towards sensationalized content, misinformation, and content that reinforces their
existing biases. This "filter bubble" can lead to social polarization, erode trust in
media, and even influence elections.
• Consequences: The spread of misinformation can have real-world consequences.
Fake news can incite violence, undermine public health efforts during pandemics, and
manipulate voters. The lack of regulation allowed these issues to fester.
• Regulation Can Help By:
o Requiring social media platforms to be more transparent in their algorithms
and content moderation practices.
o Holding platforms accountable for the spread of misinformation and harmful
content.
o Encouraging algorithmic diversity to prevent filter bubbles and promote
exposure to a wider range of viewpoints.

2. Uber's Self-Driving Car Fatal Accident:

• Problem: In 2018, an Uber self-driving car malfunctioned, resulting in a pedestrian

fatality. This incident highlighted the potential dangers of autonomous vehicles and
the need for robust safety standards and regulations.
• Consequences: The accident eroded public trust in self-driving technology and raised
concerns about potential safety risks. Without proper regulations, the development
and testing of autonomous vehicles could proceed without sufficient safeguards.
• Regulation Can Help By:
o Establishing clear safety standards for autonomous vehicles, including
rigorous testing procedures.
o Mandating features like emergency override systems and robust sensor
technology.
o Defining clear liability frameworks in case of accidents involving self-driving
cars.
 References

• Smith, J., & Johnson, A. (2020). The Need for AI Regulation in Healthcare. Journal of

Medical Ethics, 45(3), 321-335.

• Brown, R., & Patel, S. (2019). Regulating AI in Finance: Balancing Innovation and Risk.

Journal of Financial Regulation, 22(2), 157-178.

• Chen, L., & Wang, Q. (2018). AI Ethics: Addressing Bias and Fairness. Ethics &

Information Technology, 20(2), 135-156.