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Suppetia ex machina: How can AI technologies aid financial decision-making of people with low socioeconomic status?

Author

Listed:
  • Christian T. Elbaek

    (Department of Management, Aarhus University, Denmark)

  • Ifeatu Uzodinma

    (UCL School of Slavonic and East European Studies, University College London, United Kingdom)

  • Zilia Ismagilova

    (Department of Economics and Management, University of Trento, Italy)

  • Panagiotis Mitkidis

    (Department of Management, Aarhus University, Denmark)

Abstract

In this conceptual paper, we outline how individuals with low socioeconomic status are more vulnerable to making choices that undermine their welfare in economic decision environments that require an acceptable comprehension of risk. We propose that novel technologies, specifically Artificial Intelligence, can aid in improving financial decision-making for individuals with low risk awareness, and we suggest avenues where policy can leverage emerging Artificial Intelligence technologies to design specific choice architecture that may support more risk-aware decision-making of vulnerable socioeconomic groups. Lastly, we discuss the ethics of utilizing nudges in vulnerable populations, the limitations of our approach, and how our paper can pave way for future research to improve decision-making for socioeconomically vulnerable individuals.

Suggested Citation

  • Christian T. Elbaek & Ifeatu Uzodinma & Zilia Ismagilova & Panagiotis Mitkidis, 2022. "Suppetia ex machina: How can AI technologies aid financial decision-making of people with low socioeconomic status?," Journal of Behavioral Economics for Policy, Society for the Advancement of Behavioral Economics (SABE), vol. 6(S1), pages 49-57, July.
    • Handle: RePEc:beh:jbepv1:v:6:y:2022:i:s1:p:49-57
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    References listed on IDEAS

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    More about this item

    Keywords

    decision-making; SES; AI; nudging; choice architecture;
    All these keywords.

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • P46 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

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