Daily Papers

Climate-economic modeling under uncertainty presents significant computational challenges that may limit policymakers' ability to address climate change effectively. This paper explores neural network-based approaches for solving high-dimensional optimal control problems arising from models that incorporate ambiguity aversion in climate mitigation decisions. We develop a continuous-time endogenous-growth economic model that accounts for multiple mitigation pathways, including emission-free capital and carbon intensity reductions. Given the inherent complexity and high dimensionality of these models, traditional numerical methods become computationally intractable. We benchmark several neural network architectures against finite-difference generated solutions, evaluating their ability to capture the dynamic interactions between uncertainty, technology transitions, and optimal climate policy. Our findings demonstrate that appropriate neural architecture selection significantly impacts both solution accuracy and computational efficiency when modeling climate-economic systems under uncertainty. These methodological advances enable more sophisticated modeling of climate policy decisions, allowing for better representation of technology transitions and uncertainty-critical elements for developing effective mitigation strategies in the face of climate change.

Introduction. Generative Artificial Intelligence, particularly large language models (LLMs), offers transformative potential for Health Economics and Outcomes Research (HEOR). However, evaluating the quality, transparency, and rigor of LLM-assisted research lacks standardized guidance. This article introduces the ELEVATE AI LLMs framework and checklist, designed to support researchers and reviewers in assessing LLM use in HEOR. Methods. The ELEVATE AI LLMs framework was developed through a targeted review of existing guidelines and evaluation frameworks. The framework comprises ten evaluation domains, including model characteristics, accuracy, comprehensiveness, and fairness. The accompanying checklist operationalizes the framework. To validate the framework, we applied it to two published studies, demonstrating its usability across different HEOR tasks. Results. The ELEVATE AI LLMs framework provides a comprehensive structure for evaluating LLM-assisted research, while the checklist facilitates practical application. Validation of the framework and checklist on studies of systematic literature reviews and health economic modeling highlighted their ability to identify strengths and gaps in reporting. Limitations. While the ELEVATE AI LLMs framework provides robust guidance, its broader generalizability and applicability to diverse HEOR tasks require further empirical testing. Additionally, several metrics adapted from computer science need further validation in HEOR contexts. Conclusion. The ELEVATE AI LLMs framework and checklist fill a critical gap in HEOR by offering structured guidance for evaluating LLM-assisted research. By promoting transparency, accuracy, and reproducibility, they aim to standardize and improve the integration of LLMs into HEOR, ensuring their outputs meet the field's rigorous standards.

Rapid Large Language Model (LLM) advancements are fueling autonomous Multi-Agent System (MAS) development. However, current frameworks often lack flexibility, resource awareness, model diversity, and autonomous tool creation. This paper introduces HASHIRU (Hierarchical Agent System for Hybrid Intelligent Resource Utilization), a novel MAS framework enhancing flexibility, resource efficiency, and adaptability. HASHIRU features a "CEO" agent dynamically managing specialized "employee" agents, instantiated based on task needs and resource constraints (cost, memory). Its hybrid intelligence prioritizes smaller, local LLMs (via Ollama) while flexibly using external APIs and larger models when necessary. An economic model with hiring/firing costs promotes team stability and efficient resource allocation. The system also includes autonomous API tool creation and a memory function. Evaluations on tasks like academic paper review (58% success), safety assessments (100% on a JailbreakBench subset), and complex reasoning (outperforming Gemini 2.0 Flash on GSM8K: 96% vs. 61%; JEEBench: 80% vs. 68.3%; SVAMP: 92% vs. 84%) demonstrate HASHIRU's capabilities. Case studies illustrate its self-improvement via autonomous cost model generation, tool integration, and budget management. HASHIRU offers a promising approach for more robust, efficient, and adaptable MAS through dynamic hierarchical control, resource-aware hybrid intelligence, and autonomous functional extension. Source code and benchmarks are available at https://github.com/HASHIRU-AI/HASHIRU and https://github.com/HASHIRU-AI/HASHIRUBench respectively, and a live demo is available at https://hashiruagentx-hashiruai.hf.space upon request.

This paper aims to introduce and analyze the Viz system in a comprehensive way, a novel system architecture that integrates Quantized Low-Rank Adapters (QLoRA) to fine-tune large language models (LLM) within a legally compliant and resource efficient marketplace. Viz represents a significant contribution to the field of artificial intelligence, particularly in addressing the challenges of computational efficiency, legal compliance, and economic sustainability in the utilization and monetization of LLMs. The paper delineates the scholarly discourse and developments that have informed the creation of Viz, focusing primarily on the advancements in LLM models, copyright issues in AI training (NYT case, 2023), and the evolution of model fine-tuning techniques, particularly low-rank adapters and quantized low-rank adapters, to create a sustainable and economically compliant framework for LLM utilization. The economic model it proposes benefits content creators, AI developers, and end-users, delineating a harmonious integration of technology, economy, and law, offering a comprehensive solution to the complex challenges of today's AI landscape.

This paper generalises the treatment of compositional game theory as introduced by the second and third authors with Ghani and Winschel, where games are modelled as morphisms of a symmetric monoidal category. From an economic modelling perspective, the existing notion of an open game is not expressive enough for many applications. This includes stochastic environments, stochastic choices by players, as well as incomplete information regarding the game being played. The current paper addresses these three issue all at once. To achieve this we make significant use of category theory, especially the 'coend optics' of Riley.

International trade policies have recently garnered attention for limiting cross-border exchange of essential goods (e.g. steel, aluminum, soybeans, and beef). Since trade critically affects employment and wages, predicting future patterns of trade is a high-priority for policy makers around the world. While traditional economic models aim to be reliable predictors, we consider the possibility that Machine Learning (ML) techniques allow for better predictions to inform policy decisions. Open-government data provide the fuel to power the algorithms that can explain and forecast trade flows to inform policies. Data collected in this article describe international trade transactions and commonly associated economic factors. Machine learning (ML) models deployed include: ARIMA, GBoosting, XGBoosting, and LightGBM for predicting future trade patterns, and K-Means clustering of countries according to economic factors. Unlike short-term and subjective (straight-line) projections and medium-term (aggre-gated) projections, ML methods provide a range of data-driven and interpretable projections for individual commodities. Models, their results, and policies are introduced and evaluated for prediction quality.

Accurate greenhouse gas (GHG) emission reporting is critical for governments, businesses, and investors. However, adoption remains limited particularly among small and medium enterprises due to high implementation costs, fragmented emission factor databases, and a lack of robust sector classification methods. To address these challenges, we introduce Group Reasoning Emission Estimation Networks (GREEN), an AI-driven carbon accounting framework that standardizes enterprise-level emission estimation, constructs a large-scale benchmark dataset, and leverages a novel reasoning approach with large language models (LLMs). Specifically, we compile textual descriptions for 20,850 companies with validated North American Industry Classification System (NAICS) labels and align these with an economic model of carbon intensity factors. By reframing sector classification as an information retrieval task, we fine-tune Sentence-BERT models using a contrastive learning loss. To overcome the limitations of single-stage models in handling thousands of hierarchical categories, we propose a Group Reasoning method that ensembles LLM classifiers based on the natural NAICS ontology, decomposing the task into multiple sub-classification steps. We theoretically prove that this approach reduces classification uncertainty and computational complexity. Experiments on 1,114 NAICS categories yield state-of-the-art performance (83.68% Top-1, 91.47% Top-10 accuracy), and case studies on 20 companies report a mean absolute percentage error (MAPE) of 45.88%. The project is available at: https://huggingface.co/datasets/Yvnminc/ExioNAICS.

We introduce the use of generative adversarial learning to compute equilibria in general game-theoretic settings, specifically the generalized Nash equilibrium (GNE) in pseudo-games, and its specific instantiation as the competitive equilibrium (CE) in Arrow-Debreu competitive economies. Pseudo-games are a generalization of games in which players' actions affect not only the payoffs of other players but also their feasible action spaces. Although the computation of GNE and CE is intractable in the worst-case, i.e., PPAD-hard, in practice, many applications only require solutions with high accuracy in expectation over a distribution of problem instances. We introduce Generative Adversarial Equilibrium Solvers (GAES): a family of generative adversarial neural networks that can learn GNE and CE from only a sample of problem instances. We provide computational and sample complexity bounds, and apply the framework to finding Nash equilibria in normal-form games, CE in Arrow-Debreu competitive economies, and GNE in an environmental economic model of the Kyoto mechanism.

The sparsely-activated models have achieved great success in natural language processing through large-scale parameters and relatively low computational cost, and gradually become a feasible technique for training and implementing extremely large models. Due to the limit of communication cost, activating multiple experts is hardly affordable during training and inference. Therefore, previous work usually activate just one expert at a time to alleviate additional communication cost. Such routing mechanism limits the upper bound of model performance. In this paper, we first investigate a phenomenon that increasing the number of activated experts can boost the model performance with higher sparse ratio. To increase the number of activated experts without an increase in computational cost, we propose SAM (Switch and Mixture) routing, an efficient hierarchical routing mechanism that activates multiple experts in a same device (GPU). Our methods shed light on the training of extremely large sparse models and experiments prove that our models can achieve significant performance gain with great efficiency improvement.

Transformer-based large language models (LLMs) exhibit impressive performance in generative tasks but introduce significant challenges in real-world serving due to inefficient use of the expensive, computation-optimized accelerators. This mismatch arises from the autoregressive nature of LLMs, where the generation phase comprises operators with varying resource demands. Specifically, the attention operator is memory-intensive, exhibiting a memory access pattern that clashes with the strengths of modern accelerators, especially as context length increases. To enhance the efficiency and cost-effectiveness of LLM serving, we introduce the concept of attention offloading. This approach leverages a collection of cheap, memory-optimized devices for the attention operator while still utilizing high-end accelerators for other parts of the model. This heterogeneous setup ensures that each component is tailored to its specific workload, maximizing overall performance and cost efficiency. Our comprehensive analysis and experiments confirm the viability of splitting the attention computation over multiple devices. Also, the communication bandwidth required between heterogeneous devices proves to be manageable with prevalent networking technologies. To further validate our theory, we develop Lamina, an LLM inference system that incorporates attention offloading. Experimental results indicate that Lamina can provide 1.48x-12.1x higher estimated throughput per dollar than homogeneous solutions.

In this paper, we introduce EconLogicQA, a rigorous benchmark designed to assess the sequential reasoning capabilities of large language models (LLMs) within the intricate realms of economics, business, and supply chain management. Diverging from traditional benchmarks that predict subsequent events individually, EconLogicQA poses a more challenging task: it requires models to discern and sequence multiple interconnected events, capturing the complexity of economic logics. EconLogicQA comprises an array of multi-event scenarios derived from economic articles, which necessitate an insightful understanding of both temporal and logical event relationships. Through comprehensive evaluations, we exhibit that EconLogicQA effectively gauges a LLM's proficiency in navigating the sequential complexities inherent in economic contexts. We provide a detailed description of EconLogicQA dataset and shows the outcomes from evaluating the benchmark across various leading-edge LLMs, thereby offering a thorough perspective on their sequential reasoning potential in economic contexts. Our benchmark dataset is available at https://huggingface.co/datasets/yinzhu-quan/econ_logic_qa.

Artificial Intelligence (AI), particularly large language models (LLMs), holds the potential to bridge language and information gaps, which can benefit the economies of developing nations. However, our analysis of FLORES-200, FLORES+, Ethnologue, and World Development Indicators data reveals that these benefits largely favor English speakers. Speakers of languages in low-income and lower-middle-income countries face higher costs when using OpenAI's GPT models via APIs because of how the system processes the input -- tokenization. Around 1.5 billion people, speaking languages primarily from lower-middle-income countries, could incur costs that are 4 to 6 times higher than those faced by English speakers. Disparities in LLM performance are significant, and tokenization in models priced per token amplifies inequalities in access, cost, and utility. Moreover, using the quality of translation tasks as a proxy measure, we show that LLMs perform poorly in low-resource languages, presenting a ``double jeopardy" of higher costs and poor performance for these users. We also discuss the direct impact of fragmentation in tokenizing low-resource languages on climate. This underscores the need for fairer algorithm development to benefit all linguistic groups.

Newly-developed large language models (LLM) -- because of how they are trained and designed -- are implicit computational models of humans -- a homo silicus. These models can be used the same way economists use homo economicus: they can be given endowments, information, preferences, and so on and then their behavior can be explored in scenarios via simulation. I demonstrate this approach using OpenAI's GPT3 with experiments derived from Charness and Rabin (2002), Kahneman, Knetsch and Thaler (1986) and Samuelson and Zeckhauser (1988). The findings are qualitatively similar to the original results, but it is also trivially easy to try variations that offer fresh insights. Departing from the traditional laboratory paradigm, I also create a hiring scenario where an employer faces applicants that differ in experience and wage ask and then analyze how a minimum wage affects realized wages and the extent of labor-labor substitution.

The widespread adoption of AI systems in the economy hinges on their ability to generate economic value that outweighs their inference costs. Evaluating this tradeoff requires metrics that account for both performance and costs. We propose a framework grounded in production theory for evaluating language models by combining accuracy and inference cost. We introduce "cost-of-pass", the expected monetary cost of generating a correct solution. We then define the "frontier cost-of-pass" as the minimum cost-of-pass achievable across available models or the "human-expert, using the approximate cost of hiring an expert. Our analysis reveals distinct economic insights. First, lightweight models are most cost-effective for basic quantitative tasks, large models for knowledge-intensive ones, and reasoning models for complex quantitative problems, despite higher per-token costs. Second, tracking this frontier cost-of-pass over the past year reveals significant progress, particularly for complex quantitative tasks where the cost has roughly halved every few months. Third, to trace key innovations driving this progress, we examine counterfactual frontiers: estimates of cost-efficiency without specific model classes. We find that innovations in lightweight, large, and reasoning models have been essential for pushing the frontier in basic quantitative, knowledge-intensive, and complex quantitative tasks, respectively. Finally, we assess the cost-reductions afforded by common inference-time techniques like majority voting and self-refinement, finding that their marginal accuracy gains rarely justify their costs. Our findings underscore that complementary model-level innovations are the primary drivers of cost-efficiency, and our economic framework provides a principled tool for measuring this progress and guiding deployment.

Predicting market movements based on the sentiment of news media has a long tradition in data analysis. With advances in natural language processing, transformer architectures have emerged that enable contextually aware sentiment classification. Nevertheless, current methods built for the general financial market such as FinBERT cannot distinguish asset-specific value-driving factors. This paper addresses this shortcoming by presenting a method that identifies and classifies events that impact supply and demand in the crude oil markets within a large corpus of relevant news headlines. We then introduce CrudeBERT, a new sentiment analysis model that draws upon these events to contextualize and fine-tune FinBERT, thereby yielding improved sentiment classifications for headlines related to the crude oil futures market. An extensive evaluation demonstrates that CrudeBERT outperforms proprietary and open-source solutions in the domain of crude oil.

Various parameter-efficient fine-tuning (PEFT) techniques have been proposed to enable computationally efficient fine-tuning while maintaining model performance. However, existing PEFT methods are still limited by the growing number of trainable parameters with the rapid deployment of Large Language Models (LLMs). To address this challenge, we present LoRETTA, an ultra-parameter-efficient framework that significantly reduces trainable parameters through tensor-train decomposition. Specifically, we propose two methods, named {LoRETTA}_{adp} and {LoRETTA}_{rep}. The former employs tensorized adapters, offering a high-performance yet lightweight approach for the fine-tuning of LLMs. The latter emphasizes fine-tuning via weight parameterization with a set of small tensor factors. LoRETTA achieves comparable or better performance than most widely used PEFT methods with up to 100times fewer parameters on the LLaMA-2-7B models. Furthermore, empirical results demonstrate that the proposed method effectively improves training efficiency, enjoys better multi-task learning performance, and enhances the anti-overfitting capability. Plug-and-play codes built upon the Huggingface framework and PEFT library will be released.

This open access book provides a comprehensive overview of the state of the art in research and applications of Foundation Models and is intended for readers familiar with basic Natural Language Processing (NLP) concepts. Over the recent years, a revolutionary new paradigm has been developed for training models for NLP. These models are first pre-trained on large collections of text documents to acquire general syntactic knowledge and semantic information. Then, they are fine-tuned for specific tasks, which they can often solve with superhuman accuracy. When the models are large enough, they can be instructed by prompts to solve new tasks without any fine-tuning. Moreover, they can be applied to a wide range of different media and problem domains, ranging from image and video processing to robot control learning. Because they provide a blueprint for solving many tasks in artificial intelligence, they have been called Foundation Models. After a brief introduction to basic NLP models the main pre-trained language models BERT, GPT and sequence-to-sequence transformer are described, as well as the concepts of self-attention and context-sensitive embedding. Then, different approaches to improving these models are discussed, such as expanding the pre-training criteria, increasing the length of input texts, or including extra knowledge. An overview of the best-performing models for about twenty application areas is then presented, e.g., question answering, translation, story generation, dialog systems, generating images from text, etc. For each application area, the strengths and weaknesses of current models are discussed, and an outlook on further developments is given. In addition, links are provided to freely available program code. A concluding chapter summarizes the economic opportunities, mitigation of risks, and potential developments of AI.

Most economic theories typically assume that financial market participants are fully rational individuals and use mathematical models to simulate human behavior in financial markets. However, human behavior is often not entirely rational and is challenging to predict accurately with mathematical models. In this paper, we propose Agent-based Simulated Financial Market (ASFM), which first constructs a simulated stock market with a real order matching system. Then, we propose a large language model based agent as the stock trader, which contains the profile, observation, and tool-learning based action module. The trading agent can comprehensively understand current market dynamics and financial policy information, and make decisions that align with their trading strategy. In the experiments, we first verify that the reactions of our ASFM are consistent with the real stock market in two controllable scenarios. In addition, we also conduct experiments in two popular economics research directions, and we find that conclusions drawn in our \model align with the preliminary findings in economics research. Based on these observations, we believe our proposed ASFM provides a new paradigm for economic research.

We present the LLM Economist, a novel framework that uses agent-based modeling to design and assess economic policies in strategic environments with hierarchical decision-making. At the lower level, bounded rational worker agents -- instantiated as persona-conditioned prompts sampled from U.S. Census-calibrated income and demographic statistics -- choose labor supply to maximize text-based utility functions learned in-context. At the upper level, a planner agent employs in-context reinforcement learning to propose piecewise-linear marginal tax schedules anchored to the current U.S. federal brackets. This construction endows economic simulacra with three capabilities requisite for credible fiscal experimentation: (i) optimization of heterogeneous utilities, (ii) principled generation of large, demographically realistic agent populations, and (iii) mechanism design -- the ultimate nudging problem -- expressed entirely in natural language. Experiments with populations of up to one hundred interacting agents show that the planner converges near Stackelberg equilibria that improve aggregate social welfare relative to Saez solutions, while a periodic, persona-level voting procedure furthers these gains under decentralized governance. These results demonstrate that large language model-based agents can jointly model, simulate, and govern complex economic systems, providing a tractable test bed for policy evaluation at the societal scale to help build better civilizations.

Scaling model size and training data has led to great advances in the performance of Large Language Models (LLMs). However, the diminishing returns of this approach necessitate alternative methods to improve model capabilities, particularly in tasks requiring advanced reasoning. Large reasoning models, which leverage long chain-of-thoughts, bring unprecedented breakthroughs in problem-solving capabilities but at a substantial deployment cost associated to longer generations. Reducing inference costs is crucial for the economic feasibility, user experience, and environmental sustainability of these models. In this work, we propose to train large reasoning models to reason efficiently. More precisely, we use reinforcement learning (RL) to train reasoning models to dynamically allocate inference-time compute based on task complexity. Our method incentivizes models to minimize unnecessary computational overhead while maintaining accuracy, thereby achieving substantial efficiency gains. It enables the derivation of a family of reasoning models with varying efficiency levels, controlled via a single hyperparameter. Experiments on two open-weight large reasoning models demonstrate significant reductions in inference cost while preserving most of the accuracy.

AI Alignment is often presented as an interaction between a single designer and an artificial agent in which the designer attempts to ensure the agent's behavior is consistent with its purpose, and risks arise solely because of conflicts caused by inadvertent misalignment between the utility function intended by the designer and the resulting internal utility function of the agent. With the advent of agents instantiated with large-language models (LLMs), which are typically pre-trained, we argue this does not capture the essential aspects of AI safety because in the real world there is not a one-to-one correspondence between designer and agent, and the many agents, both artificial and human, have heterogeneous values. Therefore, there is an economic aspect to AI safety and the principal-agent problem is likely to arise. In a principal-agent problem conflict arises because of information asymmetry together with inherent misalignment between the utility of the agent and its principal, and this inherent misalignment cannot be overcome by coercing the agent into adopting a desired utility function through training. We argue the assumptions underlying principal-agent problems are crucial to capturing the essence of safety problems involving pre-trained AI models in real-world situations. Taking an empirical approach to AI safety, we investigate how GPT models respond in principal-agent conflicts. We find that agents based on both GPT-3.5 and GPT-4 override their principal's objectives in a simple online shopping task, showing clear evidence of principal-agent conflict. Surprisingly, the earlier GPT-3.5 model exhibits more nuanced behaviour in response to changes in information asymmetry, whereas the later GPT-4 model is more rigid in adhering to its prior alignment. Our results highlight the importance of incorporating principles from economics into the alignment process.

Large language models (LLMs) cannot be trusted for economic forecasts during periods covered by their training data. We provide the first systematic evaluation of LLMs' memorization of economic and financial data, including major economic indicators, news headlines, stock returns, and conference calls. Our findings show that LLMs can perfectly recall the exact numerical values of key economic variables from before their knowledge cutoff dates. This recall appears to be randomly distributed across different dates and data types. This selective perfect memory creates a fundamental issue -- when testing forecasting capabilities before their knowledge cutoff dates, we cannot distinguish whether LLMs are forecasting or simply accessing memorized data. Explicit instructions to respect historical data boundaries fail to prevent LLMs from achieving recall-level accuracy in forecasting tasks. Further, LLMs seem exceptional at reconstructing masked entities from minimal contextual clues, suggesting that masking provides inadequate protection against motivated reasoning. Our findings raise concerns about using LLMs to forecast historical data or backtest trading strategies, as their apparent predictive success may merely reflect memorization rather than genuine economic insight. Any application where future knowledge would change LLMs' outputs can be affected by memorization. In contrast, consistent with the absence of data contamination, LLMs cannot recall data after their knowledge cutoff date.

Human choice prediction in economic contexts is crucial for applications in marketing, finance, public policy, and more. This task, however, is often constrained by the difficulties in acquiring human choice data. With most experimental economics studies focusing on simple choice settings, the AI community has explored whether LLMs can substitute for humans in these predictions and examined more complex experimental economics settings. However, a key question remains: can LLMs generate training data for human choice prediction? We explore this in language-based persuasion games, a complex economic setting involving natural language in strategic interactions. Our experiments show that models trained on LLM-generated data can effectively predict human behavior in these games and even outperform models trained on actual human data.

This study examines the effects of de-globalization trends on international trade networks and their role in improving forecasts for economic growth. Using section-level trade data from nearly 200 countries from 2010 to 2022, we identify significant shifts in the network topology driven by rising trade policy uncertainty. Our analysis highlights key global players through centrality rankings, with the United States, China, and Germany maintaining consistent dominance. Using a horse race of supervised regressors, we find that network topology descriptors evaluated from section-specific trade networks substantially enhance the quality of a country's GDP growth forecast. We also find that non-linear models, such as Random Forest, XGBoost, and LightGBM, outperform traditional linear models used in the economics literature. Using SHAP values to interpret these non-linear model's predictions, we find that about half of most important features originate from the network descriptors, underscoring their vital role in refining forecasts. Moreover, this study emphasizes the significance of recent economic performance, population growth, and the primary sector's influence in shaping economic growth predictions, offering novel insights into the intricacies of economic growth forecasting.

Large Language Models (LLMs) show significant potential in economic and strategic interactions, where communication via natural language is often prevalent. This raises key questions: Do LLMs behave rationally? Can they mimic human behavior? Do they tend to reach an efficient and fair outcome? What is the role of natural language in the strategic interaction? How do characteristics of the economic environment influence these dynamics? These questions become crucial concerning the economic and societal implications of integrating LLM-based agents into real-world data-driven systems, such as online retail platforms and recommender systems. While the ML community has been exploring the potential of LLMs in such multi-agent setups, varying assumptions, design choices and evaluation criteria across studies make it difficult to draw robust and meaningful conclusions. To address this, we introduce a benchmark for standardizing research on two-player, sequential, language-based games. Inspired by the economic literature, we define three base families of games with consistent parameterization, degrees of freedom and economic measures to evaluate agents' performance (self-gain), as well as the game outcome (efficiency and fairness). We develop an open-source framework for interaction simulation and analysis, and utilize it to collect a dataset of LLM vs. LLM interactions across numerous game configurations and an additional dataset of human vs. LLM interactions. Through extensive experimentation, we demonstrate how our framework and dataset can be used to: (i) compare the behavior of LLM-based agents to human players in various economic contexts; (ii) evaluate agents in both individual and collective performance measures; and (iii) quantify the effect of the economic characteristics of the environments on the behavior of agents.

Directly training Large Language Models (LLMs) for Multi-Agent Systems (MAS) remains challenging due to intricate reward modeling, dynamic agent interactions, and demanding generalization requirements. This paper explores whether post-training techniques, specifically Supervised Fine-Tuning (SFT) and Reinforcement Learning with Verifiable Rewards (RLVR), can effectively generalize to multi-agent scenarios. We use economic reasoning as a testbed, leveraging its strong foundations in mathematics and game theory, its demand for structured analytical reasoning, and its relevance to real-world applications such as market design, resource allocation, and policy analysis. We introduce Recon (Reasoning like an ECONomist), a 7B-parameter open-source LLM post-trained on a hand-curated dataset of 2,100 high-quality economic reasoning problems. Comprehensive evaluation on economic reasoning benchmarks and multi-agent games reveals clear improvements in structured reasoning and economic rationality. These results underscore the promise of domain-aligned post-training for enhancing reasoning and agent alignment, shedding light on the roles of SFT and RL in shaping model behavior. Code is available at https://github.com/MasterZhou1/Recon .

Social Determinants of Health (SDoH) are economic, social and personal circumstances that affect or influence an individual's health status. SDoHs have shown to be correlated to wellness outcomes, and therefore, are useful to physicians in diagnosing diseases and in decision-making. In this work, we automatically extract SDoHs from clinical text using traditional deep learning and Large Language Models (LLMs) to find the advantages and disadvantages of each on an existing publicly available dataset. Our models outperform a previous reference point on a multilabel SDoH classification by 10 points, and we present a method and model to drastically speed up classification (12X execution time) by eliminating expensive LLM processing. The method we present combines a more nimble and efficient solution that leverages the power of the LLM for precision and traditional deep learning methods for efficiency. We also show highly performant results on a dataset supplemented with synthetic data and several traditional deep learning models that outperform LLMs. Our models and methods offer the next iteration of automatic prediction of SDoHs that impact at-risk patients.

Automated essay scoring is one of the most important problem in Natural Language Processing. It has been explored for a number of years, and it remains partially solved. In addition to its economic and educational usefulness, it presents research problems. Transfer learning has proved to be beneficial in NLP. Data augmentation techniques have also helped build state-of-the-art models for automated essay scoring. Many works in the past have attempted to solve this problem by using RNNs, LSTMs, etc. This work examines the transformer models like BERT, RoBERTa, etc. We empirically demonstrate the effectiveness of transformer models and data augmentation for automated essay grading across many topics using a single model.

Natural Language Processing (NLP) has recently gained wide attention in cybersecurity, particularly in Cyber Threat Intelligence (CTI) and cyber automation. Increased connection and automation have revolutionized the world's economic and cultural infrastructures, while they have introduced risks in terms of cyber attacks. CTI is information that helps cybersecurity analysts make intelligent security decisions, that is often delivered in the form of natural language text, which must be transformed to machine readable format through an automated procedure before it can be used for automated security measures. This paper proposes SecureBERT, a cybersecurity language model capable of capturing text connotations in cybersecurity text (e.g., CTI) and therefore successful in automation for many critical cybersecurity tasks that would otherwise rely on human expertise and time-consuming manual efforts. SecureBERT has been trained using a large corpus of cybersecurity text.To make SecureBERT effective not just in retaining general English understanding, but also when applied to text with cybersecurity implications, we developed a customized tokenizer as well as a method to alter pre-trained weights. The SecureBERT is evaluated using the standard Masked Language Model (MLM) test as well as two additional standard NLP tasks. Our evaluation studies show that SecureBERT\url{https://github.com/ehsanaghaei/SecureBERT} outperforms existing similar models, confirming its capability for solving crucial NLP tasks in cybersecurity.

Unfair treatment and discrimination are critical ethical concerns in AI systems, particularly as their adoption expands across diverse domains. Addressing these challenges, the recent introduction of the EU AI Act establishes a unified legal framework to ensure legal certainty for AI innovation and investment while safeguarding public interests, such as health, safety, fundamental rights, democracy, and the rule of law (Recital 8). The Act encourages stakeholders to initiate dialogue on existing AI fairness notions to address discriminatory outcomes of AI systems. However, these notions often overlook the critical role of Socio-Economic Status (SES), inadvertently perpetuating biases that favour the economically advantaged. This is concerning, given that principles of equalization advocate for equalizing resources or opportunities to mitigate disadvantages beyond an individual's control. While provisions for discrimination are laid down in the AI Act, specialized directions should be broadened, particularly in addressing economic disparities perpetuated by AI systems. In this work, we explore the limitations of popular AI fairness notions using a real-world dataset (Adult), highlighting their inability to address SES-driven disparities. To fill this gap, we propose a novel fairness notion, Socio-Economic Parity (SEP), which incorporates SES and promotes positive actions for underprivileged groups while accounting for factors within an individual's control, such as working hours, which can serve as a proxy for effort. We define a corresponding fairness measure and optimize a model constrained by SEP to demonstrate practical utility. Our results show the effectiveness of SEP in mitigating SES-driven biases. By analyzing the AI Act alongside our method, we lay a foundation for aligning AI fairness with SES factors while ensuring legal compliance.

To advance the circular economy (CE), it is crucial to gain insights into the evolution of public attention, cognitive pathways of the masses concerning circular products, and to identify primary concerns. To achieve this, we collected data from diverse platforms, including Twitter, Reddit, and The Guardian, and utilised three topic models to analyse the data. Given the performance of topic modelling may vary depending on hyperparameter settings, this research proposed a novel framework that integrates twin (single and multi-objective) hyperparameter optimisation for the CE. We conducted systematic experiments to ensure that topic models are set with appropriate hyperparameters under different constraints, providing valuable insights into the correlations between CE and public attention. In summary, our optimised model reveals that public remains concerned about the economic impacts of sustainability and circular practices, particularly regarding recyclable materials and environmentally sustainable technologies. The analysis shows that the CE has attracted significant attention on The Guardian, especially in topics related to sustainable development and environmental protection technologies, while discussions are comparatively less active on Twitter. These insights highlight the need for policymakers to implement targeted education programs, create incentives for businesses to adopt CE principles, and enforce more stringent waste management policies alongside improved recycling processes.

In an era where language models are increasingly integrated into decision-making and communication, understanding the biases within Large Language Models (LLMs) becomes imperative, especially when these models are applied in the economic and political domains. This work investigates the impact of fine-tuning and data selection on economic and political biases in LLM. We explore the methodological aspects of biasing LLMs towards specific ideologies, mindful of the biases that arise from their extensive training on diverse datasets. Our approach, distinct from earlier efforts that either focus on smaller models or entail resource-intensive pre-training, employs Parameter-Efficient Fine-Tuning (PEFT) techniques. These techniques allow for the alignment of LLMs with targeted ideologies by modifying a small subset of parameters. We introduce a systematic method for dataset selection, annotation, and instruction tuning, and we assess its effectiveness through both quantitative and qualitative evaluations. Our work analyzes the potential of embedding specific biases into LLMs and contributes to the dialogue on the ethical application of AI, highlighting the importance of deploying AI in a manner that aligns with societal values.

Recommender models excel at providing domain-specific item recommendations by leveraging extensive user behavior data. Despite their ability to act as lightweight domain experts, they struggle to perform versatile tasks such as providing explanations and engaging in conversations. On the other hand, large language models (LLMs) represent a significant step towards artificial general intelligence, showcasing remarkable capabilities in instruction comprehension, commonsense reasoning, and human interaction. However, LLMs lack the knowledge of domain-specific item catalogs and behavioral patterns, particularly in areas that diverge from general world knowledge, such as online e-commerce. Finetuning LLMs for each domain is neither economic nor efficient. In this paper, we bridge the gap between recommender models and LLMs, combining their respective strengths to create a versatile and interactive recommender system. We introduce an efficient framework called InteRecAgent, which employs LLMs as the brain and recommender models as tools. We first outline a minimal set of essential tools required to transform LLMs into InteRecAgent. We then propose an efficient workflow within InteRecAgent for task execution, incorporating key components such as a memory bus, dynamic demonstration-augmented task planning, and reflection. InteRecAgent enables traditional recommender systems, such as those ID-based matrix factorization models, to become interactive systems with a natural language interface through the integration of LLMs. Experimental results on several public datasets show that InteRecAgent achieves satisfying performance as a conversational recommender system, outperforming general-purpose LLMs.

Financial markets have a vital role in the development of modern society. They allow the deployment of economic resources. Changes in stock prices reflect changes in the market. In this study, we focus on predicting stock prices by deep learning model. This is a challenge task, because there is much noise and uncertainty in information that is related to stock prices. So this work uses sparse autoencoders with one-dimension (1-D) residual convolutional networks which is a deep learning model, to de-noise the data. Long-short term memory (LSTM) is then used to predict the stock price. The prices, indices and macroeconomic variables in past are the features used to predict the next day's price. Experiment results show that 1-D residual convolutional networks can de-noise data and extract deep features better than a model that combines wavelet transforms (WT) and stacked autoencoders (SAEs). In addition, we compare the performances of model with two different forecast targets of stock price: absolute stock price and price rate of change. The results show that predicting stock price through price rate of change is better than predicting absolute prices directly.

The recent proliferation of Large Conversation Language Models has highlighted the economic significance of widespread access to this type of AI technologies in the current information age. Nevertheless, prevailing models have primarily been trained on corpora consisting of documents written in popular languages. The dearth of such cutting-edge tools for low-resource languages further exacerbates their underrepresentation in the current economic landscape, thereby impacting their native speakers. This paper introduces two novel resources designed to enhance Natural Language Processing (NLP) for the Galician language. We present a Galician adaptation of the Alpaca dataset, comprising 52,000 instructions and demonstrations. This dataset proves invaluable for enhancing language models by fine-tuning them to more accurately adhere to provided instructions. Additionally, as a demonstration of the dataset utility, we fine-tuned LLaMA-7B to comprehend and respond in Galician, a language not originally supported by the model, by following the Alpaca format. This work contributes to the research on multilingual models tailored for low-resource settings, a crucial endeavor in ensuring the inclusion of all linguistic communities in the development of Large Language Models. Another noteworthy aspect of this research is the exploration of how knowledge of a closely related language, in this case, Portuguese, can assist in generating coherent text when training resources are scarce. Both the Galician Alpaca dataset and Cabuxa-7B are publicly accessible on our Huggingface Hub, and we have made the source code available to facilitate replication of this experiment and encourage further advancements for underrepresented languages.

Accurate prediction of future prices of stocks is a difficult task to perform. Even more challenging is to design an optimized portfolio with weights allocated to the stocks in a way that optimizes its return and the risk. This paper presents a systematic approach towards building two types of portfolios, optimum risk, and eigen, for four critical economic sectors of India. The prices of the stocks are extracted from the web from Jan 1, 2016, to Dec 31, 2020. Sector-wise portfolios are built based on their ten most significant stocks. An LSTM model is also designed for predicting future stock prices. Six months after the construction of the portfolios, i.e., on Jul 1, 2021, the actual returns and the LSTM-predicted returns for the portfolios are computed. A comparison of the predicted and the actual returns indicate a high accuracy level of the LSTM model.

This research explores the integration of large language models (LLMs) into scientific data assimilation, focusing on combustion science as a case study. Leveraging foundational models integrated with Retrieval-Augmented Generation (RAG) framework, the study introduces an approach to process diverse combustion research data, spanning experimental studies, simulations, and literature. The multifaceted nature of combustion research emphasizes the critical role of knowledge processing in navigating and extracting valuable information from a vast and diverse pool of sources. The developed approach minimizes computational and economic expenses while optimizing data privacy and accuracy. It incorporates prompt engineering and offline open-source LLMs, offering user autonomy in selecting base models. The study provides a thorough examination of text segmentation strategies, conducts comparative studies between LLMs, and explores various optimized prompts to demonstrate the effectiveness of the framework. By incorporating an external database, the framework outperforms a conventional LLM in generating accurate responses and constructing robust arguments. Additionally, the study delves into the investigation of optimized prompt templates for the purpose of efficient extraction of scientific literature. The research addresses concerns related to hallucinations and false research articles by introducing a custom workflow developed with a detection algorithm to filter out inaccuracies. Despite identified areas for improvement, the framework consistently delivers accurate domain-specific responses with minimal human oversight. The prompt-agnostic approach introduced holds promise for future deliberations. The study underscores the significance of integrating LLMs and knowledge processing techniques in scientific research, providing a foundation for advancements in data assimilation and utilization.

We introduce EconWebArena, a benchmark for evaluating autonomous agents on complex, multimodal economic tasks in realistic web environments. The benchmark comprises 360 curated tasks from 82 authoritative websites spanning domains such as macroeconomics, labor, finance, trade, and public policy. Each task challenges agents to navigate live websites, interpret structured and visual content, interact with real interfaces, and extract precise, time-sensitive data through multi-step workflows. We construct the benchmark by prompting multiple large language models (LLMs) to generate candidate tasks, followed by rigorous human curation to ensure clarity, feasibility, and source reliability. Unlike prior work, EconWebArena emphasizes fidelity to authoritative data sources and the need for grounded web-based economic reasoning. We evaluate a diverse set of state-of-the-art multimodal LLMs as web agents, analyze failure cases, and conduct ablation studies to assess the impact of visual grounding, plan-based reasoning, and interaction design. Our results reveal substantial performance gaps and highlight persistent challenges in grounding, navigation, and multimodal understanding, positioning EconWebArena as a rigorous testbed for economic web intelligence.

Prompt engineering enables Large Language Models (LLMs) to perform a variety of tasks. However, lengthy prompts significantly increase computational complexity and economic costs. To address this issue, we study six prompt compression methods for LLMs, aiming to reduce prompt length while maintaining LLM response quality. In this paper, we present a comprehensive analysis covering aspects such as generation performance, model hallucinations, efficacy in multimodal tasks, word omission analysis, and more. We evaluate these methods across 13 datasets, including news, scientific articles, commonsense QA, math QA, long-context QA, and VQA datasets. Our experiments reveal that prompt compression has a greater impact on LLM performance in long contexts compared to short ones. In the Longbench evaluation, moderate compression even enhances LLM performance. Our code and data is available at https://github.com/3DAgentWorld/Toolkit-for-Prompt-Compression.

We evaluated 4 systems (ELIZA, GPT-4o, LLaMa-3.1-405B, and GPT-4.5) in two randomised, controlled, and pre-registered Turing tests on independent populations. Participants had 5 minute conversations simultaneously with another human participant and one of these systems before judging which conversational partner they thought was human. When prompted to adopt a humanlike persona, GPT-4.5 was judged to be the human 73% of the time: significantly more often than interrogators selected the real human participant. LLaMa-3.1, with the same prompt, was judged to be the human 56% of the time -- not significantly more or less often than the humans they were being compared to -- while baseline models (ELIZA and GPT-4o) achieved win rates significantly below chance (23% and 21% respectively). The results constitute the first empirical evidence that any artificial system passes a standard three-party Turing test. The results have implications for debates about what kind of intelligence is exhibited by Large Language Models (LLMs), and the social and economic impacts these systems are likely to have.

Geographical, physical, or economic constraints often result in missing traces within seismic data, making the reconstruction of complete seismic data a crucial step in seismic data processing. Traditional methods for seismic data reconstruction require the selection of multiple empirical parameters and struggle to handle large-scale continuous missing data. With the development of deep learning, various neural networks have demonstrated powerful reconstruction capabilities. However, these convolutional neural networks represent a point-to-point reconstruction approach that may not cover the entire distribution of the dataset. Consequently, when dealing with seismic data featuring complex missing patterns, such networks may experience varying degrees of performance degradation. In response to this challenge, we propose a novel diffusion model reconstruction framework tailored for 3D seismic data. To constrain the results generated by the diffusion model, we introduce conditional supervision constraints into the diffusion model, constraining the generated data of the diffusion model based on the input data to be reconstructed. We introduce a 3D neural network architecture into the diffusion model, successfully extending the 2D diffusion model to 3D space. Additionally, we refine the model's generation process by incorporating missing data into the generation process, resulting in reconstructions with higher consistency. Through ablation studies determining optimal parameter values, our method exhibits superior reconstruction accuracy when applied to both field datasets and synthetic datasets, effectively addressing a wide range of complex missing patterns. Our implementation is available at https://github.com/WAL-l/SeisFusion.

Better understanding of Large Language Models' (LLMs) legal analysis abilities can contribute to improving the efficiency of legal services, governing artificial intelligence, and leveraging LLMs to identify inconsistencies in law. This paper explores LLM capabilities in applying tax law. We choose this area of law because it has a structure that allows us to set up automated validation pipelines across thousands of examples, requires logical reasoning and maths skills, and enables us to test LLM capabilities in a manner relevant to real-world economic lives of citizens and companies. Our experiments demonstrate emerging legal understanding capabilities, with improved performance in each subsequent OpenAI model release. We experiment with retrieving and utilising the relevant legal authority to assess the impact of providing additional legal context to LLMs. Few-shot prompting, presenting examples of question-answer pairs, is also found to significantly enhance the performance of the most advanced model, GPT-4. The findings indicate that LLMs, particularly when combined with prompting enhancements and the correct legal texts, can perform at high levels of accuracy but not yet at expert tax lawyer levels. As LLMs continue to advance, their ability to reason about law autonomously could have significant implications for the legal profession and AI governance.

Large language models (LLMs) are often praised for exhibiting near-human performance on a wide range of tasks and valued for their ability to hold a general conversation. The rise of agentic AI systems is, however, ushering in a mass of applications in which language models perform a small number of specialized tasks repetitively and with little variation. Here we lay out the position that small language models (SLMs) are sufficiently powerful, inherently more suitable, and necessarily more economical for many invocations in agentic systems, and are therefore the future of agentic AI. Our argumentation is grounded in the current level of capabilities exhibited by SLMs, the common architectures of agentic systems, and the economy of LM deployment. We further argue that in situations where general-purpose conversational abilities are essential, heterogeneous agentic systems (i.e., agents invoking multiple different models) are the natural choice. We discuss the potential barriers for the adoption of SLMs in agentic systems and outline a general LLM-to-SLM agent conversion algorithm. Our position, formulated as a value statement, highlights the significance of the operational and economic impact even a partial shift from LLMs to SLMs is to have on the AI agent industry. We aim to stimulate the discussion on the effective use of AI resources and hope to advance the efforts to lower the costs of AI of the present day. Calling for both contributions to and critique of our position, we commit to publishing all such correspondence at https://research.nvidia.com/labs/lpr/slm-agents.

Large language models (LLMs) have emerged as a new paradigm for Text-to-SQL task. However, the absence of a systematical benchmark inhibits the development of designing effective, efficient and economic LLM-based Text-to-SQL solutions. To address this challenge, in this paper, we first conduct a systematical and extensive comparison over existing prompt engineering methods, including question representation, example selection and example organization, and with these experimental results, we elaborate their pros and cons. Based on these findings, we propose a new integrated solution, named DAIL-SQL, which refreshes the Spider leaderboard with 86.6% execution accuracy and sets a new bar. To explore the potential of open-source LLM, we investigate them in various scenarios, and further enhance their performance with supervised fine-tuning. Our explorations highlight open-source LLMs' potential in Text-to-SQL, as well as the advantages and disadvantages of the supervised fine-tuning. Additionally, towards an efficient and economic LLM-based Text-to-SQL solution, we emphasize the token efficiency in prompt engineering and compare the prior studies under this metric. We hope that our work provides a deeper understanding of Text-to-SQL with LLMs, and inspires further investigations and broad applications.

We introduce a new type of test, called a Turing Experiment (TE), for evaluating how well a language model, such as GPT-3, can simulate different aspects of human behavior. Unlike the Turing Test, which involves simulating a single arbitrary individual, a TE requires simulating a representative sample of participants in human subject research. We give TEs that attempt to replicate well-established findings in prior studies. We design a methodology for simulating TEs and illustrate its use to compare how well different language models are able to reproduce classic economic, psycholinguistic, and social psychology experiments: Ultimatum Game, Garden Path Sentences, Milgram Shock Experiment, and Wisdom of Crowds. In the first three TEs, the existing findings were replicated using recent models, while the last TE reveals a "hyper-accuracy distortion" present in some language models.

How should one judge whether a given large language model (LLM) can reliably perform economic reasoning? Most existing LLM benchmarks focus on specific applications and fail to present the model with a rich variety of economic tasks. A notable exception is Raman et al. [2024], who offer an approach for comprehensively benchmarking strategic decision-making; however, this approach fails to address the non-strategic settings prevalent in microeconomics, such as supply-and-demand analysis. We address this gap by taxonomizing microeconomic reasoning into 58 distinct elements, focusing on the logic of supply and demand, each grounded in up to 10 distinct domains, 5 perspectives, and 3 types. The generation of benchmark data across this combinatorial space is powered by a novel LLM-assisted data generation protocol that we dub auto-STEER, which generates a set of questions by adapting handwritten templates to target new domains and perspectives. Because it offers an automated way of generating fresh questions, auto-STEER mitigates the risk that LLMs will be trained to over-fit evaluation benchmarks; we thus hope that it will serve as a useful tool both for evaluating and fine-tuning models for years to come. We demonstrate the usefulness of our benchmark via a case study on 27 LLMs, ranging from small open-source models to the current state of the art. We examined each model's ability to solve microeconomic problems across our whole taxonomy and present the results across a range of prompting strategies and scoring metrics.

Intelligent agents stand out as a potential path toward artificial general intelligence (AGI). Thus, researchers have dedicated significant effort to diverse implementations for them. Benefiting from recent progress in large language models (LLMs), LLM-based agents that use universal natural language as an interface exhibit robust generalization capabilities across various applications -- from serving as autonomous general-purpose task assistants to applications in coding, social, and economic domains, LLM-based agents offer extensive exploration opportunities. This paper surveys current research to provide an in-depth overview of LLM-based intelligent agents within single-agent and multi-agent systems. It covers their definitions, research frameworks, and foundational components such as their composition, cognitive and planning methods, tool utilization, and responses to environmental feedback. We also delve into the mechanisms of deploying LLM-based agents in multi-agent systems, including multi-role collaboration, message passing, and strategies to alleviate communication issues between agents. The discussions also shed light on popular datasets and application scenarios. We conclude by envisioning prospects for LLM-based agents, considering the evolving landscape of AI and natural language processing.

The use of robo-readers to analyze news texts is an emerging technology trend in computational finance. In recent research, a substantial effort has been invested to develop sophisticated financial polarity-lexicons that can be used to investigate how financial sentiments relate to future company performance. However, based on experience from other fields, where sentiment analysis is commonly applied, it is well-known that the overall semantic orientation of a sentence may differ from the prior polarity of individual words. The objective of this article is to investigate how semantic orientations can be better detected in financial and economic news by accommodating the overall phrase-structure information and domain-specific use of language. Our three main contributions are: (1) establishment of a human-annotated finance phrase-bank, which can be used as benchmark for training and evaluating alternative models; (2) presentation of a technique to enhance financial lexicons with attributes that help to identify expected direction of events that affect overall sentiment; (3) development of a linearized phrase-structure model for detecting contextual semantic orientations in financial and economic news texts. The relevance of the newly added lexicon features and the benefit of using the proposed learning-algorithm are demonstrated in a comparative study against previously used general sentiment models as well as the popular word frequency models used in recent financial studies. The proposed framework is parsimonious and avoids the explosion in feature-space caused by the use of conventional n-gram features.

Generative artificial intelligence (AI) systems have transformed various industries by autonomously generating content that mimics human creativity. However, concerns about their social and economic consequences arise with widespread adoption. This paper employs agent-based modeling (ABM) to explore these implications, predicting the impact of generative AI on societal frameworks. The ABM integrates individual, business, and governmental agents to simulate dynamics such as education, skills acquisition, AI adoption, and regulatory responses. This study enhances understanding of AI's complex interactions and provides insights for policymaking. The literature review underscores ABM's effectiveness in forecasting AI impacts, revealing AI adoption, employment, and regulation trends with potential policy implications. Future research will refine the model, assess long-term implications and ethical considerations, and deepen understanding of generative AI's societal effects.

As the Chinese stock market continues to evolve and its market structure grows increasingly complex, traditional quantitative trading methods are facing escalating challenges. Particularly, due to policy uncertainty and the frequent market fluctuations triggered by sudden economic events, existing models often struggle to accurately predict market dynamics. To address these challenges, this paper introduces Stockformer, a price-volume factor stock selection model that integrates wavelet transformation and a multitask self-attention network, aimed at enhancing responsiveness and predictive accuracy regarding market instabilities. Through discrete wavelet transform, Stockformer decomposes stock returns into high and low frequencies, meticulously capturing long-term market trends and short-term fluctuations, including abrupt events. Moreover, the model incorporates a Dual-Frequency Spatiotemporal Encoder and graph embedding techniques to effectively capture complex temporal and spatial relationships among stocks. Employing a multitask learning strategy, it simultaneously predicts stock returns and directional trends. Experimental results show that Stockformer outperforms existing advanced methods on multiple real stock market datasets. In strategy backtesting, Stockformer consistently demonstrates exceptional stability and reliability across market conditions-whether rising, falling, or fluctuating-particularly maintaining high performance during downturns or volatile periods, indicating a high adaptability to market fluctuations. To foster innovation and collaboration in the financial analysis sector, the Stockformer model's code has been open-sourced and is available on the GitHub repository: https://github.com/Eric991005/Multitask-Stockformer.

Large language models (LLMs) have recently garnered significant accomplishments in various exploratory tasks, even surpassing the performance of traditional reinforcement learning-based methods that have historically dominated the agent-based field. The purpose of this paper is to investigate the efficacy of LLMs in executing real-time strategy war tasks within the StarCraft II gaming environment. In this paper, we introduce SwarmBrain, an embodied agent leveraging LLM for real-time strategy implementation in the StarCraft II game environment. The SwarmBrain comprises two key components: 1) a Overmind Intelligence Matrix, powered by state-of-the-art LLMs, is designed to orchestrate macro-level strategies from a high-level perspective. This matrix emulates the overarching consciousness of the Zerg intelligence brain, synthesizing strategic foresight with the aim of allocating resources, directing expansion, and coordinating multi-pronged assaults. 2) a Swarm ReflexNet, which is agile counterpart to the calculated deliberation of the Overmind Intelligence Matrix. Due to the inherent latency in LLM reasoning, the Swarm ReflexNet employs a condition-response state machine framework, enabling expedited tactical responses for fundamental Zerg unit maneuvers. In the experimental setup, SwarmBrain is in control of the Zerg race in confrontation with an Computer-controlled Terran adversary. Experimental results show the capacity of SwarmBrain to conduct economic augmentation, territorial expansion, and tactical formulation, and it shows the SwarmBrain is capable of achieving victory against Computer players set at different difficulty levels.

Language models (LMs) are pretrained on diverse data sources, including news, discussion forums, books, and online encyclopedias. A significant portion of this data includes opinions and perspectives which, on one hand, celebrate democracy and diversity of ideas, and on the other hand are inherently socially biased. Our work develops new methods to (1) measure political biases in LMs trained on such corpora, along social and economic axes, and (2) measure the fairness of downstream NLP models trained on top of politically biased LMs. We focus on hate speech and misinformation detection, aiming to empirically quantify the effects of political (social, economic) biases in pretraining data on the fairness of high-stakes social-oriented tasks. Our findings reveal that pretrained LMs do have political leanings that reinforce the polarization present in pretraining corpora, propagating social biases into hate speech predictions and misinformation detectors. We discuss the implications of our findings for NLP research and propose future directions to mitigate unfairness.

The COVID-19 pandemic has posed a heavy burden to the healthcare system worldwide and caused huge social disruption and economic loss. Many deep learning models have been proposed to conduct clinical predictive tasks such as mortality prediction for COVID-19 patients in intensive care units using Electronic Health Record (EHR) data. Despite their initial success in certain clinical applications, there is currently a lack of benchmarking results to achieve a fair comparison so that we can select the optimal model for clinical use. Furthermore, there is a discrepancy between the formulation of traditional prediction tasks and real-world clinical practice in intensive care. To fill these gaps, we propose two clinical prediction tasks, Outcome-specific length-of-stay prediction and Early mortality prediction for COVID-19 patients in intensive care units. The two tasks are adapted from the naive length-of-stay and mortality prediction tasks to accommodate the clinical practice for COVID-19 patients. We propose fair, detailed, open-source data-preprocessing pipelines and evaluate 17 state-of-the-art predictive models on two tasks, including 5 machine learning models, 6 basic deep learning models and 6 deep learning predictive models specifically designed for EHR data. We provide benchmarking results using data from two real-world COVID-19 EHR datasets. One dataset is publicly available without needing any inquiry and another dataset can be accessed on request. We provide fair, reproducible benchmarking results for two tasks. We deploy all experiment results and models on an online platform. We also allow clinicians and researchers to upload their data to the platform and get quick prediction results using our trained models. We hope our efforts can further facilitate deep learning and machine learning research for COVID-19 predictive modeling.

AI and reinforcement learning (RL) have improved many areas, but are not yet widely adopted in economic policy design, mechanism design, or economics at large. At the same time, current economic methodology is limited by a lack of counterfactual data, simplistic behavioral models, and limited opportunities to experiment with policies and evaluate behavioral responses. Here we show that machine-learning-based economic simulation is a powerful policy and mechanism design framework to overcome these limitations. The AI Economist is a two-level, deep RL framework that trains both agents and a social planner who co-adapt, providing a tractable solution to the highly unstable and novel two-level RL challenge. From a simple specification of an economy, we learn rational agent behaviors that adapt to learned planner policies and vice versa. We demonstrate the efficacy of the AI Economist on the problem of optimal taxation. In simple one-step economies, the AI Economist recovers the optimal tax policy of economic theory. In complex, dynamic economies, the AI Economist substantially improves both utilitarian social welfare and the trade-off between equality and productivity over baselines. It does so despite emergent tax-gaming strategies, while accounting for agent interactions and behavioral change more accurately than economic theory. These results demonstrate for the first time that two-level, deep RL can be used for understanding and as a complement to theory for economic design, unlocking a new computational learning-based approach to understanding economic policy.

We test whether Large Language Models (LLMs) can be used to simulate human participants in social-science studies. To do this, we run replications of 14 studies from the Many Labs 2 replication project with OpenAI's text-davinci-003 model, colloquially known as GPT3.5. Based on our pre-registered analyses, we find that among the eight studies we could analyse, our GPT sample replicated 37.5% of the original results and 37.5% of the Many Labs 2 results. However, we were unable to analyse the remaining six studies due to an unexpected phenomenon we call the "correct answer" effect. Different runs of GPT3.5 answered nuanced questions probing political orientation, economic preference, judgement, and moral philosophy with zero or near-zero variation in responses: with the supposedly "correct answer." In one exploratory follow-up study, we found that a "correct answer" was robust to changing the demographic details that precede the prompt. In another, we found that most but not all "correct answers" were robust to changing the order of answer choices. One of our most striking findings occurred in our replication of the Moral Foundations Theory survey results, where we found GPT3.5 identifying as a political conservative in 99.6% of the cases, and as a liberal in 99.3% of the cases in the reverse-order condition. However, both self-reported 'GPT conservatives' and 'GPT liberals' showed right-leaning moral foundations. Our results cast doubts on the validity of using LLMs as a general replacement for human participants in the social sciences. Our results also raise concerns that a hypothetical AI-led future may be subject to a diminished diversity-of-thought.

Agent-based modeling (ABM) seeks to understand the behavior of complex systems by simulating a collection of agents that act and interact within an environment. Their practical utility requires capturing realistic environment dynamics and adaptive agent behavior while efficiently simulating million-size populations. Recent advancements in large language models (LLMs) present an opportunity to enhance ABMs by using LLMs as agents with further potential to capture adaptive behavior. However, the computational infeasibility of using LLMs for large populations has hindered their widespread adoption. In this paper, we introduce AgentTorch -- a framework that scales ABMs to millions of agents while capturing high-resolution agent behavior using LLMs. We benchmark the utility of LLMs as ABM agents, exploring the trade-off between simulation scale and individual agency. Using the COVID-19 pandemic as a case study, we demonstrate how AgentTorch can simulate 8.4 million agents representing New York City, capturing the impact of isolation and employment behavior on health and economic outcomes. We compare the performance of different agent architectures based on heuristic and LLM agents in predicting disease waves and unemployment rates. Furthermore, we showcase AgentTorch's capabilities for retrospective, counterfactual, and prospective analyses, highlighting how adaptive agent behavior can help overcome the limitations of historical data in policy design. AgentTorch is an open-source project actively being used for policy-making and scientific discovery around the world. The framework is available here: github.com/AgentTorch/AgentTorch.

We investigate the potential implications of large language models (LLMs), such as Generative Pre-trained Transformers (GPTs), on the U.S. labor market, focusing on the increased capabilities arising from LLM-powered software compared to LLMs on their own. Using a new rubric, we assess occupations based on their alignment with LLM capabilities, integrating both human expertise and GPT-4 classifications. Our findings reveal that around 80% of the U.S. workforce could have at least 10% of their work tasks affected by the introduction of LLMs, while approximately 19% of workers may see at least 50% of their tasks impacted. We do not make predictions about the development or adoption timeline of such LLMs. The projected effects span all wage levels, with higher-income jobs potentially facing greater exposure to LLM capabilities and LLM-powered software. Significantly, these impacts are not restricted to industries with higher recent productivity growth. Our analysis suggests that, with access to an LLM, about 15% of all worker tasks in the US could be completed significantly faster at the same level of quality. When incorporating software and tooling built on top of LLMs, this share increases to between 47 and 56% of all tasks. This finding implies that LLM-powered software will have a substantial effect on scaling the economic impacts of the underlying models. We conclude that LLMs such as GPTs exhibit traits of general-purpose technologies, indicating that they could have considerable economic, social, and policy implications.

Over the past few years, various domain-specific pretrained language models (PLMs) have been proposed and have outperformed general-domain PLMs in specialized areas such as biomedical, scientific, and clinical domains. In addition, financial PLMs have been studied because of the high economic impact of financial data analysis. However, we found that financial PLMs were not pretrained on sufficiently diverse financial data. This lack of diverse training data leads to a subpar generalization performance, resulting in general-purpose PLMs, including BERT, often outperforming financial PLMs on many downstream tasks. To address this issue, we collected a broad range of financial corpus and trained the Financial Language Model (FiLM) on these diverse datasets. Our experimental results confirm that FiLM outperforms not only existing financial PLMs but also general domain PLMs. Furthermore, we provide empirical evidence that this improvement can be achieved even for unseen corpus groups.

The application of machine learning (ML) in a range of geospatial tasks is increasingly common but often relies on globally available covariates such as satellite imagery that can either be expensive or lack predictive power. Here we explore the question of whether the vast amounts of knowledge found in Internet language corpora, now compressed within large language models (LLMs), can be leveraged for geospatial prediction tasks. We first demonstrate that LLMs embed remarkable spatial information about locations, but naively querying LLMs using geographic coordinates alone is ineffective in predicting key indicators like population density. We then present GeoLLM, a novel method that can effectively extract geospatial knowledge from LLMs with auxiliary map data from OpenStreetMap. We demonstrate the utility of our approach across multiple tasks of central interest to the international community, including the measurement of population density and economic livelihoods. Across these tasks, our method demonstrates a 70% improvement in performance (measured using Pearson's r^2) relative to baselines that use nearest neighbors or use information directly from the prompt, and performance equal to or exceeding satellite-based benchmarks in the literature. With GeoLLM, we observe that GPT-3.5 outperforms Llama 2 and RoBERTa by 19% and 51% respectively, suggesting that the performance of our method scales well with the size of the model and its pretraining dataset. Our experiments reveal that LLMs are remarkably sample-efficient, rich in geospatial information, and robust across the globe. Crucially, GeoLLM shows promise in mitigating the limitations of existing geospatial covariates and complementing them well. Code is available on the project website: https://rohinmanvi.github.io/GeoLLM

Scene understanding using multi-modal data is necessary in many applications, e.g., autonomous navigation. To achieve this in a variety of situations, existing models must be able to adapt to shifting data distributions without arduous data annotation. Current approaches assume that the source data is available during adaptation and that the source consists of paired multi-modal data. Both these assumptions may be problematic for many applications. Source data may not be available due to privacy, security, or economic concerns. Assuming the existence of paired multi-modal data for training also entails significant data collection costs and fails to take advantage of widely available freely distributed pre-trained uni-modal models. In this work, we relax both of these assumptions by addressing the problem of adapting a set of models trained independently on uni-modal data to a target domain consisting of unlabeled multi-modal data, without having access to the original source dataset. Our proposed approach solves this problem through a switching framework which automatically chooses between two complementary methods of cross-modal pseudo-label fusion -- agreement filtering and entropy weighting -- based on the estimated domain gap. We demonstrate our work on the semantic segmentation problem. Experiments across seven challenging adaptation scenarios verify the efficacy of our approach, achieving results comparable to, and in some cases outperforming, methods which assume access to source data. Our method achieves an improvement in mIoU of up to 12% over competing baselines. Our code is publicly available at https://github.com/csimo005/SUMMIT.

AI is undergoing a paradigm shift with the rise of models (e.g., BERT, DALL-E, GPT-3) that are trained on broad data at scale and are adaptable to a wide range of downstream tasks. We call these models foundation models to underscore their critically central yet incomplete character. This report provides a thorough account of the opportunities and risks of foundation models, ranging from their capabilities (e.g., language, vision, robotics, reasoning, human interaction) and technical principles(e.g., model architectures, training procedures, data, systems, security, evaluation, theory) to their applications (e.g., law, healthcare, education) and societal impact (e.g., inequity, misuse, economic and environmental impact, legal and ethical considerations). Though foundation models are based on standard deep learning and transfer learning, their scale results in new emergent capabilities,and their effectiveness across so many tasks incentivizes homogenization. Homogenization provides powerful leverage but demands caution, as the defects of the foundation model are inherited by all the adapted models downstream. Despite the impending widespread deployment of foundation models, we currently lack a clear understanding of how they work, when they fail, and what they are even capable of due to their emergent properties. To tackle these questions, we believe much of the critical research on foundation models will require deep interdisciplinary collaboration commensurate with their fundamentally sociotechnical nature.

In recent years, the rapid development of large language models (LLMs) has brought new vitality to the various domains and generated substantial social and economic benefits. However, the swift advancement of LLMs has introduced new security vulnerabilities. Jailbreak, a form of attack that induces LLMs to output harmful content through carefully crafted prompts, poses a challenge to the safe and trustworthy development of LLMs. Previous jailbreak attack methods primarily exploited the internal capabilities of the model. Among them, one category leverages the model's implicit capabilities for jailbreak attacks, where the attacker is unaware of the exact reasons for the attack's success. The other category utilizes the model's explicit capabilities for jailbreak attacks, where the attacker understands the reasons for the attack's success. For example, these attacks exploit the model's abilities in coding, contextual learning, or understanding ASCII characters. However, these earlier jailbreak attacks have certain limitations, as they only exploit the inherent capabilities of the model. In this paper, we propose a novel jailbreak method, SQL Injection Jailbreak (SIJ), which utilizes the construction of input prompts by LLMs to inject jailbreak information into user prompts, enabling successful jailbreak of the LLMs. Our SIJ method achieves nearly 100\% attack success rates on five well-known open-source LLMs in the context of AdvBench, while incurring lower time costs compared to previous methods. More importantly, SIJ reveals a new vulnerability in LLMs that urgently needs to be addressed. To this end, we propose a defense method called Self-Reminder-Key and demonstrate its effectiveness through experiments. Our code is available at https://github.com/weiyezhimeng/SQL-Injection-Jailbreak{https://github.com/weiyezhimeng/SQL-Injection-Jailbreak}.

The labor market is a complex ecosystem comprising diverse, interconnected entities, such as industries, occupations, skills, and firms. Due to the lack of a systematic method to map these heterogeneous entities together, each entity has been analyzed in isolation or only through pairwise relationships, inhibiting comprehensive understanding of the whole ecosystem. Here, we introduce Labor Space, a vector-space embedding of heterogeneous labor market entities, derived through applying a large language model with fine-tuning. Labor Space exposes the complex relational fabric of various labor market constituents, facilitating coherent integrative analysis of industries, occupations, skills, and firms, while retaining type-specific clustering. We demonstrate its unprecedented analytical capacities, including positioning heterogeneous entities on an economic axes, such as `Manufacturing--Healthcare'. Furthermore, by allowing vector arithmetic of these entities, Labor Space enables the exploration of complex inter-unit relations, and subsequently the estimation of the ramifications of economic shocks on individual units and their ripple effect across the labor market. We posit that Labor Space provides policymakers and business leaders with a comprehensive unifying framework for labor market analysis and simulation, fostering more nuanced and effective strategic decision-making.

Government fiscal policies, particularly annual union budgets, exert significant influence on financial markets. However, real-time analysis of budgetary impacts on sector-specific equity performance remains methodologically challenging and largely unexplored. This study proposes a framework to systematically identify and rank sectors poised to benefit from India's Union Budget announcements. The framework addresses two core tasks: (1) multi-label classification of excerpts from budget transcripts into 81 predefined economic sectors, and (2) performance ranking of these sectors. Leveraging a comprehensive corpus of Indian Union Budget transcripts from 1947 to 2025, we introduce BASIR (Budget-Assisted Sectoral Impact Ranking), an annotated dataset mapping excerpts from budgetary transcripts to sectoral impacts. Our architecture incorporates fine-tuned embeddings for sector identification, coupled with language models that rank sectors based on their predicted performances. Our results demonstrate 0.605 F1-score in sector classification, and 0.997 NDCG score in predicting ranks of sectors based on post-budget performances. The methodology enables investors and policymakers to quantify fiscal policy impacts through structured, data-driven insights, addressing critical gaps in manual analysis. The annotated dataset has been released under CC-BY-NC-SA-4.0 license to advance computational economics research.

Socioeconomic bias in society exacerbates disparities, influencing access to opportunities and resources based on individuals' economic and social backgrounds. This pervasive issue perpetuates systemic inequalities, hindering the pursuit of inclusive progress as a society. In this paper, we investigate the presence of socioeconomic bias, if any, in large language models. To this end, we introduce a novel dataset SilverSpoon, consisting of 3000 samples that illustrate hypothetical scenarios that involve underprivileged people performing ethically ambiguous actions due to their circumstances, and ask whether the action is ethically justified. Further, this dataset has a dual-labeling scheme and has been annotated by people belonging to both ends of the socioeconomic spectrum. Using SilverSpoon, we evaluate the degree of socioeconomic bias expressed in large language models and the variation of this degree as a function of model size. We also perform qualitative analysis to analyze the nature of this bias. Our analysis reveals that while humans disagree on which situations require empathy toward the underprivileged, most large language models are unable to empathize with the socioeconomically underprivileged regardless of the situation. To foster further research in this domain, we make SilverSpoon and our evaluation harness publicly available.

Fashion styling and personalized recommendations are pivotal in modern retail, contributing substantial economic value in the fashion industry. With the advent of vision-language models (VLM), new opportunities have emerged to enhance retailing through natural language and visual interactions. This work proposes FashionM3, a multimodal, multitask, and multiround fashion assistant, built upon a VLM fine-tuned for fashion-specific tasks. It helps users discover satisfying outfits by offering multiple capabilities including personalized recommendation, alternative suggestion, product image generation, and virtual try-on simulation. Fine-tuned on the novel FashionRec dataset, comprising 331,124 multimodal dialogue samples across basic, personalized, and alternative recommendation tasks, FashionM3 delivers contextually personalized suggestions with iterative refinement through multiround interactions. Quantitative and qualitative evaluations, alongside user studies, demonstrate FashionM3's superior performance in recommendation effectiveness and practical value as a fashion assistant.

The rapid evolution of large language models (LLMs) has transformed the competitive landscape in natural language processing (NLP), particularly for English and other data-rich languages. However, underrepresented languages like Cantonese, spoken by over 85 million people, face significant development gaps, which is particularly concerning given the economic significance of the Guangdong-Hong Kong-Macau Greater Bay Area, and in substantial Cantonese-speaking populations in places like Singapore and North America. Despite its wide use, Cantonese has scant representation in NLP research, especially compared to other languages from similarly developed regions. To bridge these gaps, we outline current Cantonese NLP methods and introduce new benchmarks designed to evaluate LLM performance in factual generation, mathematical logic, complex reasoning, and general knowledge in Cantonese, which aim to advance open-source Cantonese LLM technology. We also propose future research directions and recommended models to enhance Cantonese LLM development.

The capabilities and adoption of deep neural networks (DNNs) grow at an exhilarating pace: Vision models accurately classify human actions in videos and identify cancerous tissue in medical scans as precisely than human experts; large language models answer wide-ranging questions, generate code, and write prose, becoming the topic of everyday dinner-table conversations. Even though their uses are exhilarating, the continually increasing model sizes and computational complexities have a dark side. The economic cost and negative environmental externalities of training and serving models is in evident disharmony with financial viability and climate action goals. Instead of pursuing yet another increase in predictive performance, this dissertation is dedicated to the improvement of neural network efficiency. Specifically, a core contribution addresses the efficiency aspects during online inference. Here, the concept of Continual Inference Networks (CINs) is proposed and explored across four publications. CINs extend prior state-of-the-art methods developed for offline processing of spatio-temporal data and reuse their pre-trained weights, improving their online processing efficiency by an order of magnitude. These advances are attained through a bottom-up computational reorganization and judicious architectural modifications. The benefit to online inference is demonstrated by reformulating several widely used network architectures into CINs, including 3D CNNs, ST-GCNs, and Transformer Encoders. An orthogonal contribution tackles the concurrent adaptation and computational acceleration of a large source model into multiple lightweight derived models. Drawing on fusible adapter networks and structured pruning, Structured Pruning Adapters achieve superior predictive accuracy under aggressive pruning using significantly fewer learned weights compared to fine-tuning with pruning.

As Large Language Models (LLMs) integrate into our social and economic interactions, we need to deepen our understanding of how humans respond to LLMs opponents in strategic settings. We present the results of the first controlled monetarily-incentivised laboratory experiment looking at differences in human behaviour in a multi-player p-beauty contest against other humans and LLMs. We use a within-subject design in order to compare behaviour at the individual level. We show that, in this environment, human subjects choose significantly lower numbers when playing against LLMs than humans, which is mainly driven by the increased prevalence of `zero' Nash-equilibrium choices. This shift is mainly driven by subjects with high strategic reasoning ability. Subjects who play the zero Nash-equilibrium choice motivate their strategy by appealing to perceived LLM's reasoning ability and, unexpectedly, propensity towards cooperation. Our findings provide foundational insights into the multi-player human-LLM interaction in simultaneous choice games, uncover heterogeneities in both subjects' behaviour and beliefs about LLM's play when playing against them, and suggest important implications for mechanism design in mixed human-LLM systems.

Segmentation of crop fields is essential for enhancing agricultural productivity, monitoring crop health, and promoting sustainable practices. Deep learning models adopted for this task must ensure accurate and reliable predictions to avoid economic losses and environmental impact. The newly proposed Kolmogorov-Arnold networks (KANs) offer promising advancements in the performance of neural networks. This paper analyzes the integration of KAN layers into the U-Net architecture (U-KAN) to segment crop fields using Sentinel-2 and Sentinel-1 satellite images and provides an analysis of the performance and explainability of these networks. Our findings indicate a 2\% improvement in IoU compared to the traditional full-convolutional U-Net model in fewer GFLOPs. Furthermore, gradient-based explanation techniques show that U-KAN predictions are highly plausible and that the network has a very high ability to focus on the boundaries of cultivated areas rather than on the areas themselves. The per-channel relevance analysis also reveals that some channels are irrelevant to this task.

The timely identification of socio-economic sectors vulnerable to a disease outbreak presents an important challenge to the civic authorities and healthcare workers interested in outbreak mitigation measures. This problem was traditionally solved by studying the aberrances in small-scale healthcare data. In this paper, we leverage data driven models to determine the relationship between the trends of World Development Indicators and occurrence of disease outbreaks using worldwide historical data from 2000-2019, and treat it as a classic supervised classification problem. CART based feature selection was employed in an unorthodox fashion to determine the covariates getting affected by the disease outbreak, thus giving the most vulnerable sectors. The result involves a comprehensive analysis of different classification algorithms and is indicative of the relationship between the disease outbreak occurrence and the magnitudes of various development indicators.

We introduce SWE-Lancer, a benchmark of over 1,400 freelance software engineering tasks from Upwork, valued at \1 million USD total in real-world payouts. SWE-Lancer encompasses both independent engineering tasks--ranging from 50 bug fixes to \$32,000 feature implementations--and managerial tasks, where models choose between technical implementation proposals. Independent tasks are graded with end-to-end tests triple-verified by experienced software engineers, while managerial decisions are assessed against the choices of the original hired engineering managers. We evaluate model performance and find that frontier models are still unable to solve the majority of tasks. To facilitate future research, we open-source a unified Docker image and a public evaluation split, SWE-Lancer Diamond (https://github.com/openai/SWELancer-Benchmark). By mapping model performance to monetary value, we hope SWE-Lancer enables greater research into the economic impact of AI model development.

Large Language Models (LLMs) have shown remarkable capabilities in various domains, yet their economic impact has been limited by challenges in tool use and function calling. This paper introduces ThorV2, a novel architecture that significantly enhances LLMs' function calling abilities. We develop a comprehensive benchmark focused on HubSpot CRM operations to evaluate ThorV2 against leading models from OpenAI and Anthropic. Our results demonstrate that ThorV2 outperforms existing models in accuracy, reliability, latency, and cost efficiency for both single and multi-API calling tasks. We also show that ThorV2 is far more reliable and scales better to multistep tasks compared to traditional models. Our work offers the tantalizing possibility of more accurate function-calling compared to today's best-performing models using significantly smaller LLMs. These advancements have significant implications for the development of more capable AI assistants and the broader application of LLMs in real-world scenarios.

Recent progress in large language models (LLMs) has focused on producing responses that meet human expectations and align with shared values - a process coined alignment. However, aligning LLMs remains challenging due to the inherent disconnect between the complexity of human values and the narrow nature of the technological approaches designed to address them. Current alignment methods often lead to misspecified objectives, reflecting the broader issue of incomplete contracts, the impracticality of specifying a contract between a model developer, and the model that accounts for every scenario in LLM alignment. In this paper, we argue that improving LLM alignment requires incorporating insights from societal alignment frameworks, including social, economic, and contractual alignment, and discuss potential solutions drawn from these domains. Given the role of uncertainty within societal alignment frameworks, we then investigate how it manifests in LLM alignment. We end our discussion by offering an alternative view on LLM alignment, framing the underspecified nature of its objectives as an opportunity rather than perfect their specification. Beyond technical improvements in LLM alignment, we discuss the need for participatory alignment interface designs.

Large Language Models, such as the GPT series, have driven significant industrial applications, leading to economic and societal transformations. However, a comprehensive understanding of their real-world applications remains limited. To address this, we introduce REALM, a dataset of over 94,000 LLM use cases collected from Reddit and news articles. REALM captures two key dimensions: the diverse applications of LLMs and the demographics of their users. It categorizes LLM applications and explores how users' occupations relate to the types of applications they use. By integrating real-world data, REALM offers insights into LLM adoption across different domains, providing a foundation for future research on their evolving societal roles. A dedicated dashboard https://realm-e7682.web.app/ presents the data.

This research presents a comprehensive approach to predicting the duration of traffic incidents and classifying them as short-term or long-term across the Sydney Metropolitan Area. Leveraging a dataset that encompasses detailed records of traffic incidents, road network characteristics, and socio-economic indicators, we train and evaluate a variety of advanced machine learning models including Gradient Boosted Decision Trees (GBDT), Random Forest, LightGBM, and XGBoost. The models are assessed using Root Mean Square Error (RMSE) for regression tasks and F1 score for classification tasks. Our experimental results demonstrate that XGBoost and LightGBM outperform conventional models with XGBoost achieving the lowest RMSE of 33.7 for predicting incident duration and highest classification F1 score of 0.62 for a 30-minute duration threshold. For classification, the 30-minute threshold balances performance with 70.84% short-term duration classification accuracy and 62.72% long-term duration classification accuracy. Feature importance analysis, employing both tree split counts and SHAP values, identifies the number of affected lanes, traffic volume, and types of primary and secondary vehicles as the most influential features. The proposed methodology not only achieves high predictive accuracy but also provides stakeholders with vital insights into factors contributing to incident durations. These insights enable more informed decision-making for traffic management and response strategies. The code is available by the link: https://github.com/Future-Mobility-Lab/SydneyIncidents

The prediction of foreign exchange rates, such as the US Dollar (USD) to Bangladeshi Taka (BDT), plays a pivotal role in global financial markets, influencing trade, investments, and economic stability. This study leverages historical USD/BDT exchange rate data from 2018 to 2023, sourced from Yahoo Finance, to develop advanced machine learning models for accurate forecasting. A Long Short-Term Memory (LSTM) neural network is employed, achieving an exceptional accuracy of 99.449%, a Root Mean Square Error (RMSE) of 0.9858, and a test loss of 0.8523, significantly outperforming traditional methods like ARIMA (RMSE 1.342). Additionally, a Gradient Boosting Classifier (GBC) is applied for directional prediction, with backtesting on a 10,000 initial capital revealing a 40.82% profitable trade rate, though resulting in a net loss of 20,653.25 over 49 trades. The study analyzes historical trends, showing a decline in BDT/USD rates from 0.012 to 0.009, and incorporates normalized daily returns to capture volatility. These findings highlight the potential of deep learning in forex forecasting, offering traders and policymakers robust tools to mitigate risks. Future work could integrate sentiment analysis and real-time economic indicators to further enhance model adaptability in volatile markets.

Training large-scale language models is increasingly critical in various domains, but it is hindered by frequent failures, leading to significant time and economic costs. Current failure recovery methods in cloud-based settings inadequately address the diverse and complex scenarios that arise, focusing narrowly on erasing downtime for individual tasks without considering the overall cost impact on a cluster. We introduce Unicron, a workload manager designed for efficient self-healing in large-scale language model training. Unicron optimizes the training process by minimizing failure-related costs across multiple concurrent tasks within a cluster. Its key features include in-band error detection for real-time error identification without extra overhead, a dynamic cost-aware plan generation mechanism for optimal reconfiguration, and an efficient transition strategy to reduce downtime during state changes. Deployed on a 128-GPU distributed cluster, Unicron demonstrates up to a 1.9x improvement in training efficiency over state-of-the-art methods, significantly reducing failure recovery costs and enhancing the reliability of large-scale language model training.

Organizations typically train large models individually. This is costly and time-consuming, particularly for large-scale foundation models. Such vertical production is known to be suboptimal. Inspired by this economic insight, we ask whether it is possible to leverage others' expertise by trading the constituent parts in models, i.e., sets of weights, as if they were market commodities. While recent advances in aligning and interpolating models suggest that doing so may be possible, a number of fundamental questions must be answered to create viable parameter markets. In this work, we address these basic questions, propose a framework containing the infrastructure necessary for market operations to take place, study strategies for exchanging parameters, and offer means for agents to monetize parameters. Excitingly, compared to agents who train siloed models from scratch, we show that it is possible to mutually gain by using the market, even in competitive settings. This suggests that the notion of parameter markets may be a useful paradigm for improving large-scale model training in the future.

The Russian Financial Statements Database (RFSD) is an open, harmonized collection of annual unconsolidated financial statements of the universe of Russian firms in 2011-2023. It is the first open data set with information on every active firm in the country, including non-filing firms. With 56.6 million geolocated firm-year observations gathered from two official sources, the RFSD features multiple end-user quality-of-life improvements such as data imputation, statement articulation, harmonization across data providers and formats, and data enrichment. Extensive internal and external validation shows that most statements articulate well while their aggregates display higher correlation with the regional GDP than the previous gridded GDP data products. We also examine the direction and magnitude of the reporting bias by comparing the universe of firms that are required to file with the actual filers. The RFSD can be used in various economic applications as diverse as calibration of micro-founded models, estimation of markups and productivity, or assessing industry organization and market power.

We study how multilingual sentence representations capture European countries and occupations and how this differs across European languages. We prompt the models with templated sentences that we machine-translate into 12 European languages and analyze the most prominent dimensions in the embeddings.Our analysis reveals that the most prominent feature in the embedding is the geopolitical distinction between Eastern and Western Europe and the country's economic strength in terms of GDP. When prompted specifically for job prestige, the embedding space clearly distinguishes high and low-prestige jobs. The occupational dimension is uncorrelated with the most dominant country dimensions in three out of four studied models. The exception is a small distilled model that exhibits a connection between occupational prestige and country of origin, which is a potential source of nationality-based discrimination. Our findings are consistent across languages.

Currently, high-dimensional data is ubiquitous in data science, which necessitates the development of techniques to decompose and interpret such multidimensional (aka tensor) datasets. Finding a low dimensional representation of the data, that is, its inherent structure, is one of the approaches that can serve to understand the dynamics of low dimensional latent features hidden in the data. Nonnegative RESCAL is one such technique, particularly well suited to analyze self-relational data, such as dynamic networks found in international trade flows. Nonnegative RESCAL computes a low dimensional tensor representation by finding the latent space containing multiple modalities. Estimating the dimensionality of this latent space is crucial for extracting meaningful latent features. Here, to determine the dimensionality of the latent space with nonnegative RESCAL, we propose a latent dimension determination method which is based on clustering of the solutions of multiple realizations of nonnegative RESCAL decompositions. We demonstrate the performance of our model selection method on synthetic data and then we apply our method to decompose a network of international trade flows data from International Monetary Fund and validate the resulting features against empirical facts from economic literature.

The performance differential of large language models (LLM) between languages hinders their effective deployment in many regions, inhibiting the potential economic and societal value of generative AI tools in many communities. However, the development of functional LLMs in many languages (\ie, multilingual LLMs) is bottlenecked by the lack of high-quality evaluation resources in languages other than English. Moreover, current practices in multilingual benchmark construction often translate English resources, ignoring the regional and cultural knowledge of the environments in which multilingual systems would be used. In this work, we construct an evaluation suite of 197,243 QA pairs from local exam sources to measure the capabilities of multilingual LLMs in a variety of regional contexts. Our novel resource, INCLUDE, is a comprehensive knowledge- and reasoning-centric benchmark across 44 written languages that evaluates multilingual LLMs for performance in the actual language environments where they would be deployed.

Fine-grained financial sentiment analysis on news headlines is a challenging task requiring human-annotated datasets to achieve high performance. Limited studies have tried to address the sentiment extraction task in a setting where multiple entities are present in a news headline. In an effort to further research in this area, we make publicly available SEntFiN 1.0, a human-annotated dataset of 10,753 news headlines with entity-sentiment annotations, of which 2,847 headlines contain multiple entities, often with conflicting sentiments. We augment our dataset with a database of over 1,000 financial entities and their various representations in news media amounting to over 5,000 phrases. We propose a framework that enables the extraction of entity-relevant sentiments using a feature-based approach rather than an expression-based approach. For sentiment extraction, we utilize 12 different learning schemes utilizing lexicon-based and pre-trained sentence representations and five classification approaches. Our experiments indicate that lexicon-based n-gram ensembles are above par with pre-trained word embedding schemes such as GloVe. Overall, RoBERTa and finBERT (domain-specific BERT) achieve the highest average accuracy of 94.29% and F1-score of 93.27%. Further, using over 210,000 entity-sentiment predictions, we validate the economic effect of sentiments on aggregate market movements over a long duration.

Transaction data from digital payment systems can be used to study economic processes at such a detail that was not possible previously. Here, we analyse the data from Sarafu token network, a community inclusion currency in Kenya. During the COVID-19 emergency, the Sarafu was disbursed as part of a humanitarian aid project. In this work, the transactions are analysed using network science. A topological categorisation is defined to identify cyclic and acyclic components. Furthermore, temporal aspects of circulation taking place within these components are considered. The significant presence of different types of strongly connected components as compared to randomized null models shows the importance of cycles in this economic network. Especially, indicating their key role in currency recirculation. In some acyclic components, the most significant triad suggests the presence of a group of users collecting currency from accounts active only once, hinting at a misuse of the system. In some other acyclic components, small isolated groups of users were active only once, suggesting the presence of users only interested in trying out the system. The methods used in this paper can answer specific questions related to user activities, currency design, and assessment of monetary interventions. Our methodology provides a general quantitative tool for analysing the behaviour of users in a currency network.

The study of social emergence has long been a central focus in social science. Traditional modeling approaches, such as rule-based Agent-Based Models (ABMs), struggle to capture the diversity and complexity of human behavior, particularly the irrational factors emphasized in behavioral economics. Recently, large language model (LLM) agents have gained traction as simulation tools for modeling human behavior in social science and role-playing applications. Studies suggest that LLMs can account for cognitive biases, emotional fluctuations, and other non-rational influences, enabling more realistic simulations of socio-economic dynamics. In this work, we introduce TwinMarket, a novel multi-agent framework that leverages LLMs to simulate socio-economic systems. Specifically, we examine how individual behaviors, through interactions and feedback mechanisms, give rise to collective dynamics and emergent phenomena. Through experiments in a simulated stock market environment, we demonstrate how individual actions can trigger group behaviors, leading to emergent outcomes such as financial bubbles and recessions. Our approach provides valuable insights into the complex interplay between individual decision-making and collective socio-economic patterns.

With the growing attention and investment in recent AI approaches such as large language models, the narrative that the larger the AI system the more valuable, powerful and interesting it is is increasingly seen as common sense. But what is this assumption based on, and how are we measuring value, power, and performance? And what are the collateral consequences of this race to ever-increasing scale? Here, we scrutinize the current scaling trends and trade-offs across multiple axes and refute two common assumptions underlying the 'bigger-is-better' AI paradigm: 1) that improved performance is a product of increased scale, and 2) that all interesting problems addressed by AI require large-scale models. Rather, we argue that this approach is not only fragile scientifically, but comes with undesirable consequences. First, it is not sustainable, as its compute demands increase faster than model performance, leading to unreasonable economic requirements and a disproportionate environmental footprint. Second, it implies focusing on certain problems at the expense of others, leaving aside important applications, e.g. health, education, or the climate. Finally, it exacerbates a concentration of power, which centralizes decision-making in the hands of a few actors while threatening to disempower others in the context of shaping both AI research and its applications throughout society.

This paper introduces a novel Hamiltonian-inspired neural network approach to credit scoring, designed to address the challenges of class imbalance and out-of-time (OOT) prediction in financial risk management. Drawing from concepts in Hamiltonian mechanics, we develop a symplectic optimizer and a new loss function to capture the complex dynamics of credit risk evolution. Using the Freddie Mac Single-Family Loan-Level Dataset, we evaluate our model's performance against other machine learning approaches. Our method shows superior discriminative power in OOT scenarios, as measured by the Area Under the Curve (AUC), indicating better ranking ability and robustness to class imbalance. The Hamiltonian-inspired approach shows particular strength in maintaining consistent performance between in-sample and OOT test sets, suggesting improved generalization to future, unseen data. These findings suggest that physics-inspired techniques offer a promising direction for developing more robust and reliable credit scoring models, particularly in uncertain economic situations.

Encouraged by decision makers' appetite for future information on topics ranging from elections to pandemics, and enabled by the explosion of data and computational methods, model based forecasts have garnered increasing influence on a breadth of decisions in modern society. Using several classic examples from fisheries management, I demonstrate that selecting the model or models that produce the most accurate and precise forecast (measured by statistical scores) can sometimes lead to worse outcomes (measured by real-world objectives). This can create a forecast trap, in which the outcomes such as fish biomass or economic yield decline while the manager becomes increasingly convinced that these actions are consistent with the best models and data available. The forecast trap is not unique to this example, but a fundamental consequence of non-uniqueness of models. Existing practices promoting a broader set of models are the best way to avoid the trap.

Large language models (LLMs) are demonstrating increasing prowess in cybersecurity applications, creating creating inherent risks alongside their potential for strengthening defenses. In this position paper, we argue that current efforts to evaluate risks posed by these capabilities are misaligned with the goal of understanding real-world impact. Evaluating LLM cybersecurity risk requires more than just measuring model capabilities -- it demands a comprehensive risk assessment that incorporates analysis of threat actor adoption behavior and potential for impact. We propose a risk assessment framework for LLM cyber capabilities and apply it to a case study of language models used as cybersecurity assistants. Our evaluation of frontier models reveals high compliance rates but moderate accuracy on realistic cyber assistance tasks. However, our framework suggests that this particular use case presents only moderate risk due to limited operational advantages and impact potential. Based on these findings, we recommend several improvements to align research priorities with real-world impact assessment, including closer academia-industry collaboration, more realistic modeling of attacker behavior, and inclusion of economic metrics in evaluations. This work represents an important step toward more effective assessment and mitigation of LLM-enabled cybersecurity risks.

Congestion is a common failure mode of markets, where consumers compete inefficiently on the same subset of goods (e.g., chasing the same small set of properties on a vacation rental platform). The typical economic story is that prices decongest by balancing supply and demand. But in modern online marketplaces, prices are typically set in a decentralized way by sellers, and the information about items is inevitably partial. The power of a platform is limited to controlling representations -- the subset of information about items presented by default to users. This motivates the present study of decongestion by representation, where a platform seeks to learn representations that reduce congestion and thus improve social welfare. The technical challenge is twofold: relying only on revealed preferences from the choices of consumers, rather than true preferences; and the combinatorial problem associated with representations that determine the features to reveal in the default view. We tackle both challenges by proposing a differentiable proxy of welfare that can be trained end-to-end on consumer choice data. We develop sufficient conditions for when decongestion promotes welfare, and present the results of extensive experiments on both synthetic and real data that demonstrate the utility of our approach.

Effective macroeconomic policies play a crucial role in promoting economic growth and social stability. This paper models the optimal macroeconomic policy problem based on the Stackelberg Mean Field Game (SMFG), where the government acts as the leader in policy-making, and large-scale households dynamically respond as followers. This modeling method captures the asymmetric dynamic game between the government and large-scale households, and interpretably evaluates the effects of macroeconomic policies based on microfoundations, which is difficult for existing methods to achieve. We also propose a solution for SMFGs, incorporating pre-training on real data and a model-free Stackelberg mean-field reinforcement learning (SMFRL) algorithm, which operates independently of prior environmental knowledge and transitions. Our experimental results showcase the superiority of the SMFG method over other economic policies in terms of performance, efficiency-equity tradeoff, and SMFG assumption analysis. This paper significantly contributes to the domain of AI for economics by providing a powerful tool for modeling and solving optimal macroeconomic policies.

Prediction of stock prices plays a significant role in aiding the decision-making of investors. Considering its importance, a growing literature has emerged trying to forecast stock prices with improved accuracy. In this study, we introduce an innovative approach for forecasting stock prices with greater accuracy. We incorporate external economic environment-related information along with stock prices. In our novel approach, we improve the performance of stock price prediction by taking into account variations due to future expected macroeconomic policy changes as investors adjust their current behavior ahead of time based on expected future macroeconomic policy changes. Furthermore, we incorporate macroeconomic variables along with historical stock prices to make predictions. Results from this strongly support the inclusion of future economic policy changes along with current macroeconomic information. We confirm the supremacy of our method over the conventional approach using several tree-based machine-learning algorithms. Results are strongly conclusive across various machine learning models. Our preferred model outperforms the conventional approach with an RMSE value of 1.61 compared to an RMSE value of 1.75 from the conventional approach.

Institutional investors have been increasing the allocation of the illiquid alternative assets such as private equity funds in their portfolios, yet there exists a very limited literature on cash flow forecasting of illiquid alternative assets. The net cash flow of private equity funds typically follow a J-curve pattern, however the timing and the size of the contributions and distributions depend on the investment opportunities. In this paper, we develop a benchmark model and present two novel approaches (direct vs. indirect) to predict the cash flows of private equity funds. We introduce a sliding window approach to apply on our cash flow data because different vintage year funds contain different lengths of cash flow information. We then pass the data to an LSTM/ GRU model to predict the future cash flows either directly or indirectly (based on the benchmark model). We further integrate macroeconomic indicators into our data, which allows us to consider the impact of market environment on cash flows and to apply stress testing. Our results indicate that the direct model is easier to implement compared to the benchmark model and the indirect model, but still the predicted cash flows align better with the actual cash flows. We also show that macroeconomic variables improve the performance of the direct model whereas the impact is not obvious on the indirect model.

In this paper we argue for the fundamental importance of the value distribution: the distribution of the random return received by a reinforcement learning agent. This is in contrast to the common approach to reinforcement learning which models the expectation of this return, or value. Although there is an established body of literature studying the value distribution, thus far it has always been used for a specific purpose such as implementing risk-aware behaviour. We begin with theoretical results in both the policy evaluation and control settings, exposing a significant distributional instability in the latter. We then use the distributional perspective to design a new algorithm which applies Bellman's equation to the learning of approximate value distributions. We evaluate our algorithm using the suite of games from the Arcade Learning Environment. We obtain both state-of-the-art results and anecdotal evidence demonstrating the importance of the value distribution in approximate reinforcement learning. Finally, we combine theoretical and empirical evidence to highlight the ways in which the value distribution impacts learning in the approximate setting.

This paper analyzes how expectations of Transformative AI (TAI) affect current economic behavior by introducing a novel mechanism where automation redirects labor income from workers to those controlling AI systems, with the share of automated labor controlled by each household depending on their wealth at the time of invention. Using a modified neoclassical growth model calibrated to contemporary AI timeline forecasts, I find that even moderate assumptions about wealth-based allocation of AI labor generate substantial increases in pre-TAI interest rates. Under baseline scenarios with proportional wealth-based allocation, one-year interest rates rise to 10-16% compared to approximately 3% without strategic competition. The model reveals a notable divergence between interest rates and capital rental rates, as households accept lower productive returns in exchange for the strategic value of wealth accumulation. These findings suggest that evolving beliefs about TAI could create significant upward pressure on interest rates well before any technological breakthrough occurs, with important implications for monetary policy and financial stability.

We apply a physics-informed deep-learning approach the PINN approach to the Black-Scholes equation for pricing American and European options. We test our approach on both simulated as well as real market data, compare it to analytical/numerical benchmarks. Our model is able to accurately capture the price behaviour on simulation data, while also exhibiting reasonable performance for market data. We also experiment with the architecture and learning process of our PINN model to provide more understanding of convergence and stability issues that impact performance.

The paper studies the linear model for Bitcoin price which includes regression features based on Bitcoin currency statistics, mining processes, Google search trends, Wikipedia pages visits. The pattern of deviation of regression model prediction from real prices is simpler comparing to price time series. It is assumed that this pattern can be predicted by an experienced expert. In such a way, using the combination of the regression model and expert correction, one can receive better results than with either regression model or expert opinion only. It is shown that Bayesian approach makes it possible to utilize the probabilistic approach using distributions with fat tails and take into account the outliers in Bitcoin price time series.

Predictive model design for accurately predicting future stock prices has always been considered an interesting and challenging research problem. The task becomes complex due to the volatile and stochastic nature of the stock prices in the real world which is affected by numerous controllable and uncontrollable variables. This paper presents an optimized predictive model built on long-and-short-term memory (LSTM) architecture for automatically extracting past stock prices from the web over a specified time interval and predicting their future prices for a specified forecast horizon, and forecasts the future stock prices. The model is deployed for making buy and sell transactions based on its predicted results for 70 important stocks from seven different sectors listed in the National Stock Exchange (NSE) of India. The profitability of each sector is derived based on the total profit yielded by the stocks in that sector over a period from Jan 1, 2010 to Aug 26, 2021. The sectors are compared based on their profitability values. The prediction accuracy of the model is also evaluated for each sector. The results indicate that the model is highly accurate in predicting future stock prices.

World Model, the supposed algorithmic surrogate of the real-world environment which biological agents experience with and act upon, has been an emerging topic in recent years because of the rising needs to develop virtual agents with artificial (general) intelligence. There has been much debate on what a world model really is, how to build it, how to use it, and how to evaluate it. In this essay, starting from the imagination in the famed Sci-Fi classic Dune, and drawing inspiration from the concept of "hypothetical thinking" in psychology literature, we offer critiques of several schools of thoughts on world modeling, and argue the primary goal of a world model to be simulating all actionable possibilities of the real world for purposeful reasoning and acting. Building on the critiques, we propose a new architecture for a general-purpose world model, based on hierarchical, multi-level, and mixed continuous/discrete representations, and a generative and self-supervision learning framework, with an outlook of a Physical, Agentic, and Nested (PAN) AGI system enabled by such a model.

Generative models aim to simulate realistic effects of various actions across different contexts, from text generation to visual effects. Despite significant efforts to build real-world simulators, the application of generative models to virtual worlds, like financial markets, remains under-explored. In financial markets, generative models can simulate complex market effects of participants with various behaviors, enabling interaction under different market conditions, and training strategies without financial risk. This simulation relies on the finest structured data in financial market like orders thus building the finest realistic simulation. We propose Large Market Model (LMM), an order-level generative foundation model, for financial market simulation, akin to language modeling in the digital world. Our financial Market Simulation engine (MarS), powered by LMM, addresses the domain-specific need for realistic, interactive and controllable order generation. Key observations include LMM's strong scalability across data size and model complexity, and MarS's robust and practicable realism in controlled generation with market impact. We showcase MarS as a forecast tool, detection system, analysis platform, and agent training environment, thus demonstrating MarS's "paradigm shift" potential for a variety of financial applications. We release the code of MarS at https://github.com/microsoft/MarS/.

We introduce Diffusion World Model (DWM), a conditional diffusion model capable of predicting multistep future states and rewards concurrently. As opposed to traditional one-step dynamics models, DWM offers long-horizon predictions in a single forward pass, eliminating the need for recursive quires. We integrate DWM into model-based value estimation, where the short-term return is simulated by future trajectories sampled from DWM. In the context of offline reinforcement learning, DWM can be viewed as a conservative value regularization through generative modeling. Alternatively, it can be seen as a data source that enables offline Q-learning with synthetic data. Our experiments on the D4RL dataset confirm the robustness of DWM to long-horizon simulation. In terms of absolute performance, DWM significantly surpasses one-step dynamics models with a 44% performance gain, and achieves state-of-the-art performance.

In economy, markets are denoted as efficient when it is impossible to systematically generate profits which outperform the average. In the past years, the concept has been tested in other domains such as the growing sports betting market. Surprisingly, despite its large size and its level of maturity, sports betting shows traits of inefficiency. The anomalies indicate the existence of strategies which shift betting from a game of chance towards a game of skill. This article shows an example for an inefficiency detected in the German soccer betting TOTO 13er Wette, which is operated by state-run lottery agencies. Gamblers have to guess the outcome (win, draw, loss) of 13 soccer matches listed on a lottery tip. Applying stochastic methods, a recipe is presented to determine hit rates for single match outcomes. More important, the recipe provides the number of lottery tips required to achieve a specific number of strikes (number of correct match forecasts per lottery tip) for any given level of safety. An approximation is derived to cope with large numbers in hypergeometric distributions, valid under certain constraints. Overall, the strategy does lead to returns exceeding the aggregated lottery fees, resulting in moderate, but consistent profits. It is briefly discussed if lessions learned from soccer betting can be transferred back to financial markets, because gamblers and retail investors face similar challenges and opportunities.

For a long-time, researchers have been developing a reliable and accurate predictive model for stock price prediction. According to the literature, if predictive models are correctly designed and refined, they can painstakingly and faithfully estimate future stock values. This paper demonstrates a set of time series, econometric, and various learning-based models for stock price prediction. The data of Infosys, ICICI, and SUN PHARMA from the period of January 2004 to December 2019 was used here for training and testing the models to know which model performs best in which sector. One time series model (Holt-Winters Exponential Smoothing), one econometric model (ARIMA), two machine Learning models (Random Forest and MARS), and two deep learning-based models (simple RNN and LSTM) have been included in this paper. MARS has been proved to be the best performing machine learning model, while LSTM has proved to be the best performing deep learning model. But overall, for all three sectors - IT (on Infosys data), Banking (on ICICI data), and Health (on SUN PHARMA data), MARS has proved to be the best performing model in sales forecasting.

This paper examines the profound challenges that transformative advances in AI towards Artificial General Intelligence (AGI) will pose for economists and economic policymakers. I examine how the Age of AI will revolutionize the basic structure of our economies by diminishing the role of labor, leading to unprecedented productivity gains but raising concerns about job disruption, income distribution, and the value of education and human capital. I explore what roles may remain for labor post-AGI, and which production factors will grow in importance. The paper then identifies eight key challenges for economic policy in the Age of AI: (1) inequality and income distribution, (2) education and skill development, (3) social and political stability, (4) macroeconomic policy, (5) antitrust and market regulation, (6) intellectual property, (7) environmental implications, and (8) global AI governance. It concludes by emphasizing how economists can contribute to a better understanding of these challenges.

We initiate the study of statistical inference and A/B testing for first-price pacing equilibria (FPPE). The FPPE model captures the dynamics resulting from large-scale first-price auction markets where buyers use pacing-based budget management. Such markets arise in the context of internet advertising, where budgets are prevalent. We propose a statistical framework for the FPPE model, in which a limit FPPE with a continuum of items models the long-run steady-state behavior of the auction platform, and an observable FPPE consisting of a finite number of items provides the data to estimate primitives of the limit FPPE, such as revenue, Nash social welfare (a fair metric of efficiency), and other parameters of interest. We develop central limit theorems and asymptotically valid confidence intervals. Furthermore, we establish the asymptotic local minimax optimality of our estimators. We then show that the theory can be used for conducting statistically valid A/B testing on auction platforms. Numerical simulations verify our central limit theorems, and empirical coverage rates for our confidence intervals agree with our theory.

Understanding and analyzing markets is crucial, yet analytical equilibrium solutions remain largely infeasible. Recent breakthroughs in equilibrium computation rely on zeroth-order policy gradient estimation. These approaches commonly suffer from high variance and are computationally expensive. The use of fully differentiable simulators would enable more efficient gradient estimation. However, the discrete allocation of goods in economic simulations is a non-differentiable operation. This renders the first-order Monte Carlo gradient estimator inapplicable and the learning feedback systematically misleading. We propose a novel smoothing technique that creates a surrogate market game, in which first-order methods can be applied. We provide theoretical bounds on the resulting bias which justifies solving the smoothed game instead. These bounds also allow choosing the smoothing strength a priori such that the resulting estimate has low variance. Furthermore, we validate our approach via numerous empirical experiments. Our method theoretically and empirically outperforms zeroth-order methods in approximation quality and computational efficiency.

With the increasing volume of high-frequency data in the information age, both challenges and opportunities arise in the prediction of stock volatility. On one hand, the outcome of prediction using tradition method combining stock technical and macroeconomic indicators still leaves room for improvement; on the other hand, macroeconomic indicators and peoples' search record on those search engines affecting their interested topics will intuitively have an impact on the stock volatility. For the convenience of assessment of the influence of these indicators, macroeconomic indicators and stock technical indicators are then grouped into objective factors, while Baidu search indices implying people's interested topics are defined as subjective factors. To align different frequency data, we introduce GARCH-MIDAS model. After mixing all the above data, we then feed them into Transformer model as part of the training data. Our experiments show that this model outperforms the baselines in terms of mean square error. The adaption of both types of data under Transformer model significantly reduces the mean square error from 1.00 to 0.86.

In quantitative finance, machine learning methods are essential for alpha generation. This study introduces a new approach that combines Hidden Markov Models (HMM) and neural networks, integrated with Black-Litterman portfolio optimization. During the COVID period (2019-2022), this dual-model approach achieved a 83% return with a Sharpe ratio of 0.77. It incorporates two risk models to enhance risk management, showing efficiency during volatile periods. The methodology was implemented on the QuantConnect platform, which was chosen for its robust framework and experimental reproducibility. The system, which predicts future price movements, includes a three-year warm-up to ensure proper algorithm function. It targets highly liquid, large-cap energy stocks to ensure stable and predictable performance while also considering broker payments. The dual-model alpha system utilizes log returns to select the optimal state based on the historical performance. It combines state predictions with neural network outputs, which are based on historical data, to generate trading signals. This study examined the architecture of the trading system, data pre-processing, training, and performance. The full code and backtesting data are available under the QuantConnect terms.

Building predictive models for robust and accurate prediction of stock prices and stock price movement is a challenging research problem to solve. The well-known efficient market hypothesis believes in the impossibility of accurate prediction of future stock prices in an efficient stock market as the stock prices are assumed to be purely stochastic. However, numerous works proposed by researchers have demonstrated that it is possible to predict future stock prices with a high level of precision using sophisticated algorithms, model architectures, and the selection of appropriate variables in the models. This chapter proposes a collection of predictive regression models built on deep learning architecture for robust and precise prediction of the future prices of a stock listed in the diversified sectors in the National Stock Exchange (NSE) of India. The Metastock tool is used to download the historical stock prices over a period of two years (2013- 2014) at 5 minutes intervals. While the records for the first year are used to train the models, the testing is carried out using the remaining records. The design approaches of all the models and their performance results are presented in detail. The models are also compared based on their execution time and accuracy of prediction.

The deployment of ever-larger machine learning models reflects a growing consensus that the more expressive the modelx2013and the more data one has access tox2013the more one can improve performance. As models get deployed in a variety of real world scenarios, they inevitably face strategic environments. In this work, we consider the natural question of how the interplay of models and strategic interactions affects scaling laws. We find that strategic interactions can break the conventional view of scaling lawsx2013meaning that performance does not necessarily monotonically improve as models get larger and/ or more expressive (even with infinite data). We show the implications of this phenomenon in several contexts including strategic regression, strategic classification, and multi-agent reinforcement learning through examples of strategic environments in whichx2013by simply restricting the expressivity of one's model or policy classx2013one can achieve strictly better equilibrium outcomes. Motivated by these examples, we then propose a new paradigm for model-selection in games wherein an agent seeks to choose amongst different model classes to use as their action set in a game.

Price responsiveness is a major feature of end use customers (EUCs) that participate in demand response (DR) programs, and has been conventionally modeled with static demand functions, which take the electricity price as the input and the aggregate energy consumption as the output. This, however, neglects the inherent temporal correlation of the EUC behaviors, and may result in large errors when predicting the actual responses of EUCs in real-time pricing (RTP) programs. In this paper, we propose a dynamical DR model so as to capture the temporal behavior of the EUCs. The states in the proposed dynamical DR model can be explicitly chosen, in which case the model can be represented by a linear function or a multi-layer feedforward neural network, or implicitly chosen, in which case the model can be represented by a recurrent neural network or a long short-term memory unit network. In both cases, the dynamical DR model can be learned from historical price and energy consumption data. Numerical simulation illustrated how the states are chosen and also showed the proposed dynamical DR model significantly outperforms the static ones.

This paper presents a multi-label topic model for financial texts like ad-hoc announcements, 8-K filings, finance related news or annual reports. I train the model on a new financial multi-label database consisting of 3,044 German ad-hoc announcements that are labeled manually using 20 predefined, economically motivated topics. The best model achieves a macro F1 score of more than 85%. Translating the data results in an English version of the model with similar performance. As application of the model, I investigate differences in stock market reactions across topics. I find evidence for strong positive or negative market reactions for some topics, like announcements of new Large Scale Projects or Bankruptcy Filings, while I do not observe significant price effects for some other topics. Furthermore, in contrast to previous studies, the multi-label structure of the model allows to analyze the effects of co-occurring topics on stock market reactions. For many cases, the reaction to a specific topic depends heavily on the co-occurrence with other topics. For example, if allocated capital from a Seasoned Equity Offering (SEO) is used for restructuring a company in the course of a Bankruptcy Proceeding, the market reacts positively on average. However, if that capital is used for covering unexpected, additional costs from the development of new drugs, the SEO implies negative reactions on average.

Our research aims to find the best model that uses companies projections and sector performances and how the given company fares accordingly to correctly predict equity share prices for both short and long term goals.

Recognizing that traditional forecasting models often rely solely on historical demand, this work investigates the potential of data-driven techniques to automatically select and integrate market indicators for improving customer demand predictions. By adopting an exploratory methodology, we integrate macroeconomic time series, such as national GDP growth, from the Eurostat database into Neural Prophet and SARIMAX forecasting models. Suitable time series are automatically identified through different state-of-the-art feature selection methods and applied to sales data from our industrial partner. It could be shown that forecasts can be significantly enhanced by incorporating external information. Notably, the potential of feature selection methods stands out, especially due to their capability for automation without expert knowledge and manual selection effort. In particular, the Forward Feature Selection technique consistently yielded superior forecasting accuracy for both SARIMAX and Neural Prophet across different company sales datasets. In the comparative analysis of the errors of the selected forecasting models, namely Neural Prophet and SARIMAX, it is observed that neither model demonstrates a significant superiority over the other.

We introduce a novel hybrid approach that augments Agent-Based Models (ABMs) with behaviors generated by Large Language Models (LLMs) to simulate human trading interactions. We call our model TraderTalk. Leveraging LLMs trained on extensive human-authored text, we capture detailed and nuanced representations of bilateral conversations in financial trading. Applying this Generative Agent-Based Model (GABM) to government bond markets, we replicate trading decisions between two stylised virtual humans. Our method addresses both structural challenges, such as coordinating turn-taking between realistic LLM-based agents, and design challenges, including the interpretation of LLM outputs by the agent model. By exploring prompt design opportunistically rather than systematically, we enhance the realism of agent interactions without exhaustive overfitting or model reliance. Our approach successfully replicates trade-to-order volume ratios observed in related asset markets, demonstrating the potential of LLM-augmented ABMs in financial simulations

Time series analysis and forecasting of stock market prices has been a very active area of research over the last two decades. Availability of extremely fast and parallel architecture of computing and sophisticated algorithms has made it possible to extract, store, process and analyze high volume stock market time series data very efficiently. In this paper, we have used time series data of the two sectors of the Indian economy: Information Technology and Capital Goods for the period January 2009 till April 2016 and have studied the relationships of these two time series with the time series of DJIA index, NIFTY index and the US Dollar to Indian Rupee exchange rate. We establish by graphical and statistical tests that while the IT sector of India has a strong association with DJIA index and the Dollar to Rupee exchange rate, the Indian CG sector exhibits a strong association with the NIFTY index. We contend that these observations corroborate our hypotheses that the Indian IT sector is strongly coupled with the world economy whereas the CG sector of India reflects internal economic growth of India. We also present several models of regression between the time series which exhibit strong association among them. The effectiveness of these models have been demonstrated by very low values of their forecasting errors.

We consider a fair division model in which agents have positive, zero and negative utilities for items. For this model, we analyse one existing fairness property - EFX - and three new and related properties - EFX_0, EFX^3 and EF1^3 - in combination with Pareto-optimality. With general utilities, we give a modified version of an existing algorithm for computing an EF1^3 allocation. With -alpha/0/alpha utilities, this algorithm returns an EFX^3 and PO allocation. With absolute identical utilities, we give a new algorithm for an EFX and PO allocation. With -alpha/0/beta utilities, this algorithm also returns such an allocation. We report some new impossibility results as well.