The research shows that AI biases often stem from organizational pressures like cost, risk, competition, and compliance, influencing development before technical factors are considered. These biases reflect broader societal and commercial contexts, with ethical considerations often sidelined. Recommendations focus on assessing technology's impact and organizational influences on AI biases.
“… this research provides valuable insights into the complexity of detecting and preventing fraudulent activities in crowdfunding and highlights effective detection techniques that, if implemented, offer promising solutions to enhance platform reputation and ensure regulatory compliance.”
"We mathematically demonstrate how and what it means for two collective pension funds to mutually insure one another against systematic longevity risk. The key equation that facilitates the exchange of insurance is a market clearing condition. This enables an insurance market to be established even if the two funds face the same mortality risk, so long as they have different risk preferences. Provided the preferences of the two funds are not too dissimilar, insurance provides little benefit, implying the base scheme is effectively optimal. When preferences vary significantly, insurance can be beneficial."
Open innovation in software can improve security by allowing vulnerabilities to be found before release. However, for open source software, post-release vulnerabilities are more likely to be exploited due to source code visibility. This research shows that open source software faces greater attack risks after vulnerabilities are discovered compared to closed source software.
This paper argues that traditional cyber risk classifications are too restrictive for effective out-of-sample forecasting. It recommends focusing on dynamic, impact-based classifications for better predictions of cyber risk losses, suggesting that risk types are more useful for modeling event frequency rather than severity.
This paper explores moral hazard in insurance when individuals test for risk severity. It highlights how regulations and loss reduction costs impact behavior. Monetary costs lead to uniform loss reduction, while convex costs drive higher-risk individuals to reduce losses more. Insurers can incentivize risk discovery and reduction through tailored contracts.
This paper adapts Gouriéroux and Monfort's (2021) model risk framework to property and casualty insurance, focusing on policy-level data. It addresses model risk at two levels: the impact on predictions and out-of-sample uncertainty, and the need to account for risk during model selection.
This paper explores optimal insurance contracting for a decision maker facing ambiguous loss distributions. Using a p-Wasserstein ball around a benchmark distribution and a convex distortion risk measure, the indemnity function and worst-case distribution are derived. Numerical examples highlight the sensitivity of worst-case distributions to model parameters.Distributionally robust insurance under the Wasserstein distance
This research examines how ESG performance impacts default probability (PD) in life and non-life insurance firms. Findings show that improved ESG practices reduce both short-term and long-term PD, benefiting credit ratings and financial stability. Policymakers and managers can use this to enhance risk management and sustainable finance strategies.
The study assesses the impact of Europe's Single Supervisory Mechanism on banks' balance sheets, finding that centrally supervised banks have higher Tier 1 capital ratios. This is influenced by capital requirements, business models, and credit risk, particularly in countries with less stringent regulations, leading to increased resilience.