Prospects for large-scale financial systems simulation

As the 21st century unfolds, we find ourselves having to control, support, manage or otherwise cope with large-scale complex adaptive systems to an extent that is unprecedented in human history. Whether we are concerned with issues of food security, infrastructural resilience, climate change, health care, web science, security, or financial stability, we face problems that combine scale, connectivity, adaptive dynamics, and criticality. Complex systems simulation is emerging as the key scientific tool for dealing with such complex adaptive systems. Although a relatively new paradigm, it is one that has already established a track record in fields as varied as ecology (Grimm and Railsback, 2005), transport (Nagel et al., 1999), neuroscience (Markram, 2006), and ICT (Bullock and Cliff, 2004). In this report, we consider the application of simulation methodologies to financial systems, assessing the prospects for continued progress in this line of research

Society-in-the-Loop: Programming the Algorithmic Social Contract

Recent rapid advances in Artificial Intelligence (AI) and Machine Learning have raised many questions about the regulatory and governance mechanisms for autonomous machines. Many commentators, scholars, and policy-makers now call for ensuring that algorithms governing our lives are transparent, fair, and accountable. Here, I propose a conceptual framework for the regulation of AI and algorithmic systems. I argue that we need tools to program, debug and maintain an algorithmic social contract, a pact between various human stakeholders, mediated by machines. To achieve this, we can adapt the concept of human-in-the-loop (HITL) from the fields of modeling and simulation, and interactive machine learning. In particular, I propose an agenda I call society-in-the-loop (SITL), which combines the HITL control paradigm with mechanisms for negotiating the values of various stakeholders affected by AI systems, and monitoring compliance with the agreement. In short, `SITL = HITL + Social Contract.'Comment: (in press), Ethics of Information Technology, 201

A Scalable Low-Cost-UAV Traffic Network (uNet)

This article proposes a new Unmanned Aerial Vehicle (UAV) operation paradigm to enable a large number of relatively low-cost UAVs to fly beyond-line-of-sight without costly sensing and communication systems or substantial human intervention in individual UAV control. Under current free-flight-like paradigm, wherein a UAV can travel along any route as long as it avoids restricted airspace and altitudes. However, this requires expensive on-board sensing and communication as well as substantial human effort in order to ensure avoidance of obstacles and collisions. The increased cost serves as an impediment to the emergence and development of broader UAV applications. The main contribution of this work is to propose the use of pre-established route network for UAV traffic management, which allows: (i) pre- mapping of obstacles along the route network to reduce the onboard sensing requirements and the associated costs for avoiding such obstacles; and (ii) use of well-developed routing algorithms to select UAV schedules that avoid conflicts. Available GPS-based navigation can be used to fly the UAV along the selected route and time schedule with relatively low added cost, which therefore, reduces the barrier to entry into new UAV-applications market. Finally, this article proposes a new decoupling scheme for conflict-free transitions between edges of the route network at each node of the route network to reduce potential conflicts between UAVs and ensuing delays. A simulation example is used to illustrate the proposed uNet approach.Comment: To be submitted to journal, 21 pages, 9 figure

Phase transitions in Paradigm models

In this letter we propose two general models for paradigm shift, deterministic propagation model (DM) and stochastic propagation model (SM). By defining the order parameter $m$ based on the diversity of ideas, $\Delta$, we study when and how the transition occurs as a cost $C$ in DM or an innovation probability $\alpha$ in SM increases. In addition, we also investigate how the propagation processes affect on the transition nature. From the analytical calculations and numerical simulations $m$ is shown to satisfy the scaling relation $m=1-f(C/N)$ for DM with the number of agents $N$. In contrast, $m$ in SM scales as $m=1-f(\alpha^a N)$.Comment: 5 pages, 3 figure

Assessment of Prediction Techniques: The Impact of Human Uncertainty

Many data mining approaches aim at modelling and predicting human behaviour. An important quantity of interest is the quality of model-based predictions, e.g. for finding a competition winner with best prediction performance. In real life, human beings meet their decisions with considerable uncertainty. Its assessment and resulting implications for statistically evident evaluation of predictive models are in the main focus of this contribution. We identify relevant sources of uncertainty as well as the limited ability of its accurate measurement, propose an uncertainty-aware methodology for more evident evaluations of data mining approaches, and discuss its implications for existing quality assessment strategies. Specifically, our approach switches from common point-paradigm to more appropriate distribution-paradigm. This is exemplified in the context of recommender systems and their established metrics of prediction quality. The discussion is substantiated by comprehensive experiments with real users, large-scale simulations, and discussion of prior evaluation campaigns (i.a. Netflix Prize) in the light of human uncertainty aspects