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April 09, 2020

How AI is being used in this pandemic

Some sectors will get a boost from this crisis. Politico looked at how AI will be impacted by the pandemic and identified three specific areas where it is helping fight the pandemic already:

AI is already used for data collection to track and monitor the spread of the virus. Valencia was running the model using mobile phone data to predict outbreaks and how effective certain measures have been. One surprising result from this was that those infected by a spreader are usually those known to the infected, not the random individual on the street or in the supermarket.

Another key area is in hospitals to help in the daily routines to decide which patient is at risk to develop severe symptoms. In the UK, AI researchers teamed up with the NHS to help forecast the risk for each patient and make recommendations for how to treat them. There are also apps to help people staying at home to assess whether their symptoms are Covid-19 or not. 

AI is also used to find a vaccine against Covid-19. In their hunt for drugs, scientists are looking for molecules that could harm or even destroy the coronavirus inside a human body without harming the host. An Austrian team at the University in Linz developed an AI system that scans databases with hundreds of millions of such molecules. The researchers have already been able to identify around 30,000 that could block some of the proteins the coronavirus needs to survive.

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April 09, 2020

Crisis, what crisis? German edition.

We already pointed out the almost comically optimistic economic forecast by Germany’s council of economic experts. Yesterday, the Germany economics institutes doubled down with a joint forecast of a 4.2% fall in GDP this year, and a 5.8% increase in 2021. Unemployment will peak at 5.9%. Crisis, what crisis? We also love the decimal-point exactness. This forecast is of a perfectly-shaped V-type recovery. At the end of it we are going to be almost exactly where we would have been otherwise. Economically speaking, a non-event, a fairground joy-ride with a bit of excitement on the way. 

This is what happens when economic forecasters apply their dark arts, but fail to take account of risks that are outside their models, for example global network effects.  

Mercifully, one of the members of the group, the Berlin-based DIW institute, issued a minority opinion. Marcel Fratzscher and his team believe that the economic risks are serious, and favours more investment spending in areas where German public sector investment is lagging. The consensus view, however, is that the government should continue the current policy of a gradual path of public investment, and make investment decisions independently of cyclical economic movements.

We normally don’t take an interest in the dark art of economic forecasting and confidence indicators, and leave discussion of these matters to economic trainspotters. Our concern is that complacent forecasts could shift policy choices, as they did during the eurozone crisis, when economic forecasts completely failed to take account of the spillovers effects of austerity measures between countries. 

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