In a recent dialogue with Dr. John Sviokla, the spotlight turned toward a profound concept he called the "Law of Computability.” Dr. John started by underlining AI’s potential to escalate what he defines as 'computability'—a metric determined by the knowledge depth concerning a task and its level of digitization. This nexus, he argues, is where the modern economic implications of AI, particularly Generative AI, are most easily observed.
Historically, Dr. John recalls, decision-making processes, such as loan approvals, were heavily reliant on personal interactions and subjective judgments. A mere few decades ago, a bank manager might assess a loan request based on personal knowledge about the applicant—where they worshiped, their family, or even their habits. Fast forward to today, and this process has been transformed by AI and digital technologies. For instance, applying for a credit line through digital platforms like the Apple credit card involves minimal human interaction. With just a few data points, algorithms can swiftly offer substantial credit lines, showcasing AI’s role in enhancing computational decision-making.
This shift towards computability is not confined to financial sectors. Dr. John expands this concept to other domains, such as GenAI in insurance. He highlights how companies like Progressive have leveraged AI to transform their risk assessment models. Unlike traditional insurers, Progressive utilized data to cater to niche markets, like motorcycle insurance, by computing risk based on detailed customer profiles and behaviors. This computational approach not only opened new market segments, but also allowed them to offer competitive pricing based on precise risk calculations.
Furthermore, Dr. John suggests that this transformation is pervasive across various sectors where decision-making is crucial. The ability of an organization to compute outcomes more effectively than its competitors directly correlates with its success, providing it with a strategic advantage in delivering value to clients. This principle of computability, according to Field, is what distinguishes leaders in the digital age.
In wrapping up, Dr. John points to the broader implications of AI in domains that are often considered beyond the reach of computation. From writing poems to crafting sitcom jokes, and even understanding whale communications, what was once deemed ‘uncomputable’ is now within the realm of possibility. He concludes with a reflective note on the ongoing evolution in the creative industries, highlighted by his experience at a Harvard reunion where the future of automation in Hollywood was fervently discussed.
As AI continues to redefine the boundaries of what can be computed, it beckons a new era of economic and social interaction, where the fusion of knowledge and digitization not only drives efficiency, but also engenders novel paradigms for understanding and engaging with the world around us. This evolution, encapsulated in Sviokla's Law of Computability, offers a glimpse into a future where the computational power of AI becomes a fundamental cornerstone of decision-making across all facets of life.