■ Broadcast: YTN Radio FM 94.5 (09:00-10:00)
■ Host: Reporter Cho Tae-hyun
■ Air date: October 15, 2024 (Tuesday)
■ Talk: Professor of Economics at Inha University, Chun So-ra
- Question of whether AI Deep Learning is applicable to economics
* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information.
◆ Reporter Cho Tae-hyun (hereinafter referred to as Cho Tae-hyun): It's an economic story that will definitely help you to know. It's time to learn one step ahead of others. Today, we invited Professor Chun So-ra to Inha University's Department of Economics. Welcome, professor.
◇ CHEN SORA, Professor of Economics at Inha University (hereinafter CHEN SORA): Hello.
◆ Cho Tae-hyun: No matter how busy I've told you I'm going, I can't go without chatting.
◇ CHEN SORA: Yes, that's right.
◆ Cho Tae-hyun: First of all, I'll grade last week's broadcast.
◇ CHEN SORA : Yes
◆ Cho Tae-hyun: either hawkish cut or dove freeze. Although the professor chose freeze. It's because of that.
◇ CHEN SORA: Doveish. Even a partial score.
◆ Cho Tae-hyun: I'll give you half a point. Yesterday, I burst out laughing after hearing this during the National Audit of the Bank of Korea, but let's use Chatgpt instead of the Monetary Policy Committee members, how did you hear it?
◇ Chun So-ra: I think I might have made it as a joke, but a Democratic Party lawmaker said this at the parliamentary audit yesterday. Since the Monetary Policy Committee's annual salary is too high, why don't we use Chatgpt for the decision-making process? I think that's what I said. Looking at Chatgpt, he said that freezing is best in November, but he also asked the governor's answer in October, and he said, "What do you think the Bank of Korea will do with interest rates?" and he said, "I will freeze it without lowering it." But didn't he end up lowering it? So I couldn't believe Chatgpt. That's what I said.
◆ Cho Tae-hyun: I'm sure he was joking. If it's not a joke, I think it's a serious problem, but I think it was a joke.
◇ CHEN SORA: That's how I see it.
◆ Cho Tae-hyun: AI can still be an auxiliary means of decision-making, but there are still a lot of shortcomings in making decisions yourself, so I'll just dismiss these as jokes and move on. We prepared to cover the story of the Monetary Policy Committee in detail in the second part of <The Rich Tax>. Let's listen to the full-fledged story and topic in the prepared file.
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<News Voice>
This year's Nobel Prize in Economics went to scholars who studied the gap in wealth between countries, including the author of Why Countries Fail. The Nobel Committee explained that closing the income gap between countries is one of the biggest challenges of our time, and the winners have demonstrated the importance of social institutions to achieve this.
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◆ Cho Tae-hyun: The Nobel Prize in Economics was announced yesterday evening and three scholars shared the prize. Daron Azemorlu of the Massachusetts Institute of Technology, was this Türki?
◇ CHEN SORA: Yes, that's right.
◆ Cho Tae-hyun: Because the name is difficult. Professor Simon Johnson and Professor James Robinson of the University of Chicago in the U.S. are very famous. I think they are also famous as an author of "Why the Nation Fails." Have you seen this book?
◇ CHEN SORA: To be honest, I've seen about half of it. It was also No. 1 on Amazon and it's a famous book.
◆ Cho Tae-hyun: Before we started the show, we talked a little bit and readable...
◇ CHEN SORA: It was difficult.
◆ Cho Tae-hyun: It's a little difficult. I've talked about this before. What kind of contribution did you get for this award?
◇ Chun So-ra: There are many problems in society as a whole, but the physics and chemistry prizes were received by people related to AI. So there was a prediction that AI might come up with another economics award. But inequality among countries. I focus on the system and explain a lot about the differences in wealth between countries. But when I say that the system is political and economic institution here, when I compared countries around the world, historically and theoretically, empirical analysis showed that wealth flourished and was more sustainable in countries with inclusive systems. That's what I'm talking about. So the meaning of inclusion here can be interpreted differently in two ways: economic and political systems. The meaning of inclusion is that the market functions smoothly and competition is well established in fair situations, so we can talk about distribution well rather than concentrating wealth on a small number of people. When it comes to an inclusive political system, the inclusive economy and political system create synergy with each other when there are two systems where most people can participate in politics and gain a voice under the platform of democracy rather than an autocratic country where a small number of powers are concentrated. Now, when it does, these things, such as wealth, go more sustainable. That's what we're talking about. Now, one exception is China, which has a high economic growth rate, but in fact, it's hard to say that it's an inclusive political system.
◆ Cho Tae-hyun: That's right. It's not democracy. First of all, there.
◇ [Chun Sora] That's why we don't know until some time passes. Will prosperity continue? Research shows that in fact, it can be predicted that it is not sustainable.
◆ Cho Tae-hyun: That's what concerns me right now. What you said was a fair opportunity and how important democracy is to work properly. In fact, if you look at a very explicit case here, wouldn't it be Korea? South and North Korea started from a similar starting point, but the difference has widened a lot, right? You seem to be very interested in these things, too.
◇ Chun So-ra: Yes, I mentioned it in a media interview yesterday right after the award. South Korea and North Korea are examples that can be samples of these things. In a way, it started on the same line in the past, but politics and economic systems were actually in stark confrontation, but as a result, the size of the economy turned into a situation where there was a big difference. So, I understand that I mentioned one as a representative example.
◆ Cho Tae-hyun: In fact, British economists often set democratic rankings in democracies. However, Korea is always at the top or top of Asia, but the difficulty for us is that North Korea is always at the bottom. In the end, these things do not end up in politics, but also lead to the economy. But I'm asking questions about the challenges that the Korean economy has to overcome. It's said that they picked a situation where the economy of large corporations is concentrated and dominated, but this is a part that you can sympathize with a lot, right?
◇ [Chun Sora] Anyway, according to their research, the social inclusive economic system is not something where the market economy has to work well and the interests of the majority are not all concentrated on the few. Fair opportunities for everyone should be made and distribution should work well.
◆ Cho Tae-hyun: And also talking about the African side.
◇ CHEN SORA: In fact, because only certain large corporations are doing well in the current situation, we should actually pay attention to these things, and the implications of their research are actually long-term economic growth, so sustainable growth under this structure is a bit difficult.
◆ Cho Tae-hyun: Actually, Samsung Group's share of GDP in Korea is 10 to 20, so I think we need to listen to that. The inclusive system was emphasized a lot, but the person who is the most distant from the inclusive system is the U.S. presidential candidate. Trump. I heard that his approval rating has been increasing a lot recently. I didn't even talk about my concerns about this.
◇ CHEN SORA: I think Professor Robinson said in an interview yesterday, but first of all, there's a case of Trump disobeying after the last presidential election. Now there are certain democratic rules that we have made, and just rejecting them anyway raises concerns about any democratic future system. That's what we're talking about. The truth is that when clean governance systems and things like this are based, America's economic development will also be sustainable, which will be a big event on November 5th. That's what I said.
◆ Cho Tae-hyun: The most important thing when democracy takes its place is the acceptable system. There are a lot of people who consider the election system very important, but the fact that the person who objected to it has become a strong presidential candidate again doesn't really understand American democracy.
◇ CHEN SORA: Yeah, there's an ironic aspect.
◆ Cho Tae-hyun: The United States is almost the only country that maintains the true nature of the presidential system, but this is happening in that country. Anyway, let's continue to talk about it. Inequality became an issue again this year, and last year's Nobel Prize in Economics was also inequality, and can this be seen as reflecting the demands of the times?
◇ CHEN SORA: Last year, the recipient was Clodia Goldin, a Harvard history professor. There are various discriminatory factors in the current labor market, such as the wage gap between men and women, and after looking at these over a long period of time, it was a study to reveal various structural factors and how they were determined. The fact is that the market economy that we've gone back to Adam Smith in the 18th century and where the invisible hand worked is actually very different from the current economic structure. In fact, the economy is large and there has been a lot of openness between countries, and we've talked a lot about economic growth and development, but there are also aspects of distribution that have been neglected. Are they properly distributed and there is no cost for them. I think they're interested in these things worldwide. So Stiglitz, who won the Nobel Prize in Economics in the past, talked about inequality a lot, but they're talking about a broader macro perspective in terms of dealing with inequality between countries. And right now, personal wealth inequality may be a problem, for example, in the case of companies, there are actually many global multinational companies, and when some companies try to avoid taxes, for example, they can go to other countries and put money in tax havens. So, don't these studies represent the problems of the present era in that a country's problem actually transcends borders and can actually lead to a country's problem? That's what I'm thinking.
◆ Cho Tae-hyun: Actually, there are many evaluations that Korea lacks these things about the socially underprivileged, but I think there are a lot of things to listen to. Let's talk a little bit about the Nobel Prize in Economics itself. The Nobel Prize was created according to Nobel's will, and this Nobel Prize in Economics was made a little separate from that.
◇ CHEN SORA: Yeah, so the other prizes are actually Nobel Prizes, and the other prizes are actually Nobel Prizes, and the economics award actually started in 1968, compared to the other prizes that started in 1901. In fact, it is not referred to as a Nobel Prize, but its official name is 'Alfredo Nobel Memorial Swedish Central Bank Economic Prize'. So, the prize money is not given by the Nobel Foundation, but by the central bank of Sweden. In fact, if you look at why Nobel started giving this, Nobel is actually an inventor. He didn't mean to do that, but since it was used in the war, it was about giving out dynamite to those who contributed to humanity as a will.
◆ Cho Tae-hyun: Nuclear weapons were not made with that intention.
◇ Chun So-ra: So these awards were mainly focused on basic science and humanities, but from 1968, social science and economics were actually incorporated.
◆ Cho Tae-hyun: But because of that, I think there's a little bit of talk about legitimacy and bias because the Swedish central bank won the award. How do you see the professor?
◇ CHEN SORA: I think this is a problem that comes up every year. So if you think about it limited to economics, just three of the winners so far have female economists by 2003. That's what people say. Recently, Korean writer Han Kang is actually the first female writer in Asia, and who received it regardless of gender? Most of the winners are top schools in the U.S. even if you look at race, educational background, or school. It's the so-called mainstream economics that graduated from top school. So there's an incident that comes to mind when I always talk about this, and there were some protests on Wall Street in 2011.
◆ Cho Tae-hyun: That's right, that's right.
◇ Chun So-ra: Harvard students are actually in the Harvard University newspaper, but I won't take the economics and humanities class called Mankiw's economics. There are also criticisms that mainstream economics produce countries, professors, and doctors around the world, and that these things are actually paradigmatic and fixed, so they win the Nobel Prize mainly in mainstream economics, or consolidate certain vested interests.
◆ Cho Tae-hyun: This is actually something that's always been said not only in economics but also in other areas. Things like women being discriminated against and not mainstream. What's the most memorable Nobel Prize in economics that you kept coming out of?
◇ CHEN SORA: Actually, I'm able to meet most Nobel laureates in economics in textbooks, so they're all really meaningful. But recently, in connection with the Korean economy, Lucas in 1995 is now deceased, but he won the award for being a rational expectation hypothesis. When we do monetary policy or fiscal policy in the government, the people and economic players already react to what interest rates will be like in the future, and when all indicators are already reflected and the policy is already in effect, it may actually be a little less effective. That's what I'm talking about.
◆ Cho Tae-hyun: Okay. We're talking about economics right now. The professor said that earlier. You also said that there was a prospect that AI was receiving from the economy, but I concluded earlier that AI still has a long way to go, so what do you think, professor? Regarding the fact that people are pointing out that they are changing the paradigm like this.
◇ CHEN SORA: For now, it's still in progress. I think the physics and chemistry awards I just received will have a huge impact on the medical and industry in the future. However, in terms of whether it can be used now, I sometimes use Chatgpt, but in fact, there are many times when I give the wrong answer. So it takes me more time to teach this, how much can we trust and how much can we trust and follow it when we give an answer to a level that humans did not understand. That's actually a bit of a concern.
◆ Cho Tae-hyun: But in the end, if humans have to monitor it and filter the information, isn't the area AI can do limited?
◇ CHEN SORA: Personally, I think that some simple data analysis and things like that can be substituted, and I think that this is actually the human realm of making judgments and designing policies and things like that.
◆ Cho Tae-hyun: So it's hard to get to a causal relationship, like the Xerox case in the past.
◇ CHEN SORA: Because the economy is still alive and moving. I'm a little skeptical about which state of deep learning is constant and whether the way to learn it fits the economy.
◆ Cho Tae-hyun: They also mentioned it. You said that AI will only eat into some human jobs for the time being, but do you agree?
◇ CHEN SORA: I actually think that there's actually a little bit of an exaggeration to replace all of the human industry. Nevertheless, I believe that simple repetition is likely to be replaced.
◆ Cho Tae-hyun: Everyone, you don't have to worry. He said that it is unlikely to be replaced like that for the time being. So far, I've talked about various things about the Nobel Prize in Economics with Professor Chun So-ra of Inha University. Thank you for talking today.
◇ CHEN SORA: Thank you.
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