Dual Traits in Probabilistic Reasoning of Large Language Models

We conducted three experiments to investigate how large language models (LLMs) evaluate posterior probabilities. Our results reveal the coexistence of two modes in posterior judgment among state-of-the-art models: a normative mode, which adheres to Bayes' rule, and a representative-based mode, which relies on similarity -- paralleling human System 1 and System 2 thinking. Additionally, we observed that LLMs struggle to recall base rate information from their memory, and developing prompt engineering strategies to mitigate representative-based judgment may be challenging. We further conjecture that the dual modes of judgment may be a result of the contrastive loss function employed in reinforcement learning from human feedback. Our findings underscore the potential direction for reducing cognitive biases in LLMs and the necessity for cautious deployment of LLMs in critical areas.

AI and Jobs: Has the Inflection Point Arrived? Evidence from an Online Labor Platform

Artificial intelligence (AI) refers to the ability of machines or software to mimic or even surpass human intelligence in a given cognitive task. While humans learn by both induction and deduction, the success of current AI is rooted in induction, relying on its ability to detect statistical regularities in task input -- an ability learnt from a vast amount of training data using enormous computation resources. We examine the performance of such a statistical AI in a human task through the lens of four factors, including task learnability, statistical resource, computation resource, and learning techniques, and then propose a three-phase visual framework to understand the evolving relation between AI and jobs. Based on this conceptual framework, we develop a simple economic model of competition to show the existence of an inflection point for each occupation. Before AI performance crosses the inflection point, human workers always benefit from an improvement in AI performance, but after the inflection point, human workers become worse off whenever such an improvement occurs. To offer empirical evidence, we first argue that AI performance has passed the inflection point for the occupation of translation but not for the occupation of web development. We then study how the launch of ChatGPT, which led to significant improvement of AI performance on many tasks, has affected workers in these two occupations on a large online labor platform. Consistent with the inflection point conjecture, we find that translators are negatively affected by the shock both in terms of the number of accepted jobs and the earnings from those jobs, while web developers are positively affected by the very same shock. Given the potentially large disruption of AI on employment, more studies on more occupations using data from different platforms are urgently needed.