When Life Gives You AI, Will You Turn It Into A Market for Lemons? Understanding How Information Asymmetries About AI System Capabilities Affect Market Outcomes and Adoption

AI consumer markets are characterized by severe buyer-supplier market asymmetries. Complex AI systems can appear highly accurate while making costly errors or embedding hidden defects. While there have been regulatory efforts surrounding different forms of disclosure, large information gaps remain. This paper provides the first experimental evidence on the important role of information asymmetries and disclosure designs in shaping user adoption of AI systems. We systematically vary the density of low-quality AI systems and the depth of disclosure requirements in a simulated AI product market to gauge how people react to the risk of accidentally relying on a low-quality AI system. Then, we compare participants' choices to a rational Bayesian model, analyzing the degree to which partial information disclosure can improve AI adoption. Our results underscore the deleterious effects of information asymmetries on AI adoption, but also highlight the potential of partial disclosure designs to improve the overall efficiency of human decision-making.

Mind the Gap! Choice Independence in Using Multilingual LLMs for Persuasive Co-Writing Tasks in Different Languages

Recent advances in generative AI have precipitated a proliferation of novel writing assistants. These systems typically rely on multilingual large language models (LLMs), providing globalized workers the ability to revise or create diverse forms of content in different languages. However, there is substantial evidence indicating that the performance of multilingual LLMs varies between languages. Users who employ writing assistance for multiple languages are therefore susceptible to disparate output quality. Importantly, recent research has shown that people tend to generalize algorithmic errors across independent tasks, violating the behavioral axiom of choice independence. In this paper, we analyze whether user utilization of novel writing assistants in a charity advertisement writing task is affected by the AI's performance in a second language. Furthermore, we quantify the extent to which these patterns translate into the persuasiveness of generated charity advertisements, as well as the role of peoples' beliefs about LLM utilization in their donation choices. Our results provide evidence that writers who engage with an LLM-based writing assistant violate choice independence, as prior exposure to a Spanish LLM reduces subsequent utilization of an English LLM. While these patterns do not affect the aggregate persuasiveness of the generated advertisements, people's beliefs about the source of an advertisement (human versus AI) do. In particular, Spanish-speaking female participants who believed that they read an AI-generated advertisement strongly adjusted their donation behavior downwards. Furthermore, people are generally not able to adequately differentiate between human-generated and LLM-generated ads. Our work has important implications for the design, development, integration, and adoption of multilingual LLMs as assistive agents -- particularly in writing tasks.