Artificial Intelligence and Economic Analysis.

• Author: Rene Dominique, C.

The 9 papers collected in this volume were prepared for a conference on artificial intelligence (AI) held at Manchester Polytechnic in December 1990, whose purpose was to examine the potential relevance of this line of research for economics. The book purports to focus on 3 lines of AI orientated research with potential economic applications. That is, applications that attempt to undermine neoclassical economics, applications intended to reinforce it, and those that by-pass the theory by presenting what the authors call "new modelling techniques." In this, the editors deserve a cheer for trying, for I believe that AI research does hold great promises for the economic model of rational choice. Having said that, I hasten to add that, as most economists know from experience, big projects that purport to give us a more robust theory are always risky; and this one is no exception.

Since there are no clear demarcations, I presume that Part I comprises the Introduction and the next two chapters. In chapter 2, Robin Marris who (most economists would remember as the man who tried hard in his career to inject greater realism in economic and financial discourses) kicks off with a rather superficial discussion on the nature of intelligence, providing unfortunately no more than food for thought. In the next chapter, Moss focuses on AI models of complex (sic) economic systems by considering applications of two machine-learning procedures. In what I surmise as Part II, Rae and Reynolds present AI modelling techniques within a behavioral perspective. Romeo and Moss attempt, in chapter 5, to contrast the performance of expert-systems and standard economic theory in specific situations. In chapter 6, Hey and Reynolds examine, with two experiments, the extent to which individual behavior coincides with the predictions of neo-classical economic theory. In the next two, Paul Stoneman investigates, albeit in general terms, the relationship between AI and the economics of technological change, while Huw Dixon offers some thought on economic theory and AI. In the last part, Anderlini considers players' computational ability and reviews the literature on the theory of games where players are able to handle those tasks which are computable within Church's thesis, and finally; the last chapter considers potential contributions of AI to macro econometric modelling.

The reading is not always smooth due to the unevenness of the chapters as well as the amateurism of the...