Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET...

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Actuaries and AI Frank Ashe Independent Consultant & Director Available worldwide

Transcript of Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET...

Page 1: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

ActuariesandAI

FrankAsheIndependentConsultant&Director

Availableworldwide

Page 2: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

Freestylechesshttps://www.huffpost.com/entry/centaur-chess-shows-power_b_6383606

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Neuralnetworksgetthingswrong,sometimes:

https://www.nature.com/articles/d41586-019-03013-5?sf221156507=1&error=cookies_not_supported&code=f7cdca41-3bb2-46d5-8944-2d52d834f92f

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And sometimes there’s urban myths about getting things wrong THENEURALNETTANKURBANLEGEND

AIfolkloretellsastoryaboutaneuralnetworktrainedtodetecttankswhichinsteadlearnedtodetecttimeofday;investigating,thisprobablyneverhappened.

https://www.gwern.net/Tanks

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DowewantIQorEQ?See:TheStrangeOrderofThings–AntonioDamasioOurIQisintimatelyboundupwithourEQ

Damasiosuggeststhatourhard-wireddrives,urges,compulsions,impulsesandautomaticresponses,suchashunger,desireandpain,originatefrom“subjectiveexperiencesofthemomentarystateofhomeostasis”—thatis,thebody’sroutine,humdrumregulationofitsvisceralfunction.Hearguesthatthereisanorganicdialoguebetweenthisbiologicalprocessandthefeelingsthatarisefromourcontinuousscrutinyofit.Thatdiversepenumbraoffeelingsandimpulses,inturn,continuouslyinfusesconsciousthoughtand,ultimately,driveshumanbehaviour.What the body feels is every bit as significant as what the mind thinks, a neuroscientist argues. Turn to emotions to explain human consciousness and cultures

Goodreviews:https://www.theguardian.com/books/2018/feb/02/strange-order-of-things-antonio-damasio-reviewhttps://www.nature.com/articles/d41586-018-01326-5

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WhatcouldquantumcomputingdotoAI?MarkFarrell,Ph.D.,FIA𝗔𝗰𝘁𝘂𝗮𝗿𝗶𝗲𝘀:𝗤𝘂𝗮𝗻𝘁𝘂𝗺𝗖𝗼𝗺𝗽𝘂𝘁𝗶𝗻𝗴.Apotentialgamechangerforourprofession?Somewaysquantumcomputingmightaffectactuarialwork:*Modellingclimatechange,viasimulation,withgreateraccuracy.*Solvingoptimisationproblemsinfinancewithease.*StreamliningMachineLearning.*Enhancedportfolioriskoptimisation.*MoresophisticatedandaccurateMonteCarlosimulation.*Instantaneous&extremelythoroughsimulationtogainextensiveinsight.*AccelerationofArtificialIntelligence.12October2019LinkedInhttps://www.linkedin.com/posts/markfarrellactuary_actuaries-activity-6588688932043542529-ZxQPAllcorrect,but...Oneoftheproblemswithspeedingupthecomputation,whetherthroughquantumcomputingorsomethingelse,isthatmanyofthebasicproblemsarestillnotdealtwith.Weknowthewronganswermoreaccurately,morequickly.Thelimitsonaccuracyofthecalculations,andtheImplementationarestillthemajorproblems.

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HowmanypeopledieinSingaporeeachyear?Whatwouldbeatypicalrangeforthisnumber?

Page 9: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

Let’sguess!5millionpeople?Averagelifespan80years?Inequilibrium1/80thofpeoplemustdieeachyear=5,000,000/80=62,500

Page 10: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

Thisisactuallywrong,it’sabout20,000duetotheagepyramid.Seethecrudedeathratesettoincreaseasthepopulationages:

Page 11: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

What’stheexpecteduncertainty?Ifit’saPoissonvariablethenthestandarddeviationisthesquarerootoftheexpectednumber:√62,500~800Likelytobehigherthanthat

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Fermiproblems:https://en.wikipedia.org/wiki/Fermi_problemDidtheyteachyouthissortofthinking?Textbooksavailableforthiscourse!Considerasphericalcow–JohnHarteCanAIdothis?

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Trolleyology

GettingAItohaveabasicideaofethics.Needtobebuiltintosystemswherepeoplecanbehurt.

ByMcGeddon-Ownwork,CCBY-SA4.0,https://commons.wikimedia.org/w/index.php?curid=52237245

Page 14: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

BUT…

Page 15: Actuaries and AI...And sometimes there’s urban myths about getting things wrong THE NEURAL NET TANK URBAN LEGEND AI folklore tells a story about a neural network trained to detect

Doyouknowwhatyou’re

doing?

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Parallel Automatic processes – unconscious and fast too

• Anchoring,Salience,Confirmationbias,Framing,Baseratefallacy,Endowmenteffect,Illusionofknowledge,Stereotyping…

Heuristicsfordecisions

• Overconfidence,Overoptimism,In-groupfavour,Hyperbolicdiscounting,AssumptionofAgency…

Biases

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Withallthisunconsciousstuffgoingon,howdoweknow

whatwe’redoing?

Howdoweknowwhatwewilldo?

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Spurious sense making!

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Weneedtomakesenseoftheworld

Consciousprocessescan’taccesstheotherprocesses

Buildamodelofourselves–Gazzaniga’sInterpreter

Tendstoattributebehaviourtoitself

Seeswhatwe’vedoneandguessesastowhy,basedonwhatwe’vedoneinthepast

HowdoIplan?Seewhatthemodelofhowwebehavesays.

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Weneedtobeveryawarethatthereasonswethinkwehaveforwhatwedoarenotnecessarilytherealreasons.Ifweaskapersonwhytheydidsomethingtheymay,withoutbeinginanywayuntruthful,giveusthewrongreasons.Theythinkthosereasonsarecorrect,buttheyarenot.

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Ifwedon’tknowwhywedidsomething

thenwhyshouldweexpectanAItobeabletoexplainitself?


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