Artificial intelligence and systemic risk
Danielsson, Jon
; Macrae, Robert; and Uthemann, Andreas
Artificial intelligence and systemic risk.
Journal of Banking and Finance, 140: 106290.
ISSN 0378-4266
Artificial intelligence (AI) is rapidly changing how the financial system is operated, taking over core functions for both cost savings and operational efficiency reasons. AI will assist both risk managers and the financial authorities. However, it can destabilize the financial system, creating new tail risks and amplifying existing ones due to procyclicality, unknown-unknowns, the need for trust, and optimization against the system.
| Item Type | Article |
|---|---|
| Keywords | UKRI fund |
| Departments |
Finance Systemic Risk Centre |
| DOI | 10.1016/j.jbankfin.2021.106290 |
| Date Deposited | 17 Aug 2021 09:21 |
| URI | https://researchonline.lse.ac.uk/id/eprint/111601 |
ORCID: https://orcid.org/0009-0006-9844-7960
ORCID: https://orcid.org/0000-0002-7942-8530
