Large Language Models at Work in China's Labor Market

This paper explores the potential impacts of large language models (LLMs) on the Chinese labor market. We analyze occupational exposure to LLM capabilities by incorporating human expertise and LLM classifications, following Eloundou et al. (2023)'s methodology. We then aggregate occupation exposure to the industry level to obtain industry exposure scores. The results indicate a positive correlation between occupation exposure and wage levels/experience premiums, suggesting higher-paying and experience-intensive jobs may face greater displacement risks from LLM-powered software. The industry exposure scores align with expert assessments and economic intuitions. We also develop an economic growth model incorporating industry exposure to quantify the productivity-employment trade-off from AI adoption. Overall, this study provides an analytical basis for understanding the labor market impacts of increasingly capable AI systems in China. Key innovations include the occupation-level exposure analysis, industry aggregation approach, and economic modeling incorporating AI adoption and labor market effects. The findings will inform policymakers and businesses on strategies for maximizing the benefits of AI while mitigating adverse disruption risks.

It Ain't That Bad: Understanding the Mysterious Performance Drop in OOD Generalization for Generative Transformer Models

Generative Transformer-based models have achieved remarkable proficiency on solving diverse problems. However, their generalization ability is not fully understood and not always satisfying. Researchers take basic mathematical tasks like n-digit addition or multiplication as important perspectives for investigating their generalization behaviors. Curiously, it is observed that when training on n-digit operations (e.g., additions) in which both input operands are n-digit in length, models generalize successfully on unseen n-digit inputs (in-distribution (ID) generalization), but fail miserably and mysteriously on longer, unseen cases (out-of-distribution (OOD) generalization). Studies try to bridge this gap with workarounds such as modifying position embedding, fine-tuning, and priming with more extensive or instructive data. However, without addressing the essential mechanism, there is hardly any guarantee regarding the robustness of these solutions. We bring this unexplained performance drop into attention and ask whether it is purely from random errors. Here we turn to the mechanistic line of research which has notable successes in model interpretability. We discover that the strong ID generalization stems from structured representations, while behind the unsatisfying OOD performance, the models still exhibit clear learned algebraic structures. Specifically, these models map unseen OOD inputs to outputs with equivalence relations in the ID domain. These highlight the potential of the models to carry useful information for improved generalization.