Policy Studies Technology and Innovation

Getting AI Innovation Culture Right

Author

Adam Thierer
Resident Senior Fellow, Technology & Innovation

Key Points

To ensure that the United States remains a leader in advanced technology, we must create a policy culture that encourages and rewards the entrepreneurial spirit of the American people. If the United States adopts the opposite approach, entrepreneurs and investors could be locked in an “innovation cage” that constrains their growth opportunities.

Policymakers must decide between the precautionary principle or permissionless innovation. Under the precautionary principle approach, algorithmic innovations would essentially be treated as guilty until proven innocent, a legal standard generally shunned as unfair to individuals. Under the permissionless innovation approach, AI entrepreneurism is generally given a green light and treated as innocent until proven guilty, ensuring that people are mostly at liberty to create new things.

This paper explores the dangers of adopting a highly regulatory approach and recommends continuing with the more permissionless approach to policy that helped spawn the digital revolution and made U.S. tech companies global powerhouses.

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The most effective solution to technological problems usually lies in more innovation, not less.

Executive Summary

Public and political interest is intensifying in artificial intelligence (AI), machine learning and robotics. As these technological capabilities advance, legislative and regulatory proposals for algorithmic systems will grow alongside them. Public policy will play a crucial role in shaping the so-called “computational revolution.”

To ensure that the United States can be a global leader in advanced technology sectors, we must create a policy innovation culture that encourages and rewards the entrepreneurial spirit of the American people. The danger exists that the United States could adopt the opposite approach, locking entrepreneurs and investors in an “innovation cage” that constrains their growth opportunities.

Ultimately, policymakers must make a choice between two general policy defaults that will govern most algorithmic systems: the precautionary principle or permissionless innovation. Under the highly risk-averse precautionary principle approach, algorithmic innovations would essentially be treated as guilty until proven innocent, a legal standard generally shunned as unfair to individuals. Under the permissionless innovation approach, AI entrepreneurism is generally given a green light and treated as innocent until proven guilty, ensuring that people are mostly at liberty to create new things.

This paper explores the dangers of adopting a highly regulatory approach and recommends continuing with the more permissionless approach to policy that helped spawn the digital revolution and made U.S. tech companies global powerhouses. Although some safeguards will be needed to minimize certain AI risks, a more flexible, bottom-up (i.e., less regulated) governance approach can address these concerns without creating overbearing, top-down (i.e., more regulated) mandates, which would hinder algorithmic innovations.

The ramifications of this policy choice are significant because AI and algorithmic systems play an important role in the United States’ global competitive advantage and relative geopolitical power. With China becoming a major competitor in advanced information technology sectors and other nations racing to be at the forefront of the unfolding computational revolution, the United States must create a positive innovation culture if it hopes to prosper economically and ensure a safer, more secure technological base.