22 September 2024

A Realist Perspective on AI Regulation

Viktor Mayer-Schönberger and Urs Gasser

Dozens of nations around the world are hurrying legislation to regulate the design and use of artificial intelligence. Ahead of most, the European Union just passed a comprehensive AI Act. Its stringent restrictions will come into force over the next two years. Many other nations are not far behind. Global corporate players are already lamenting the resulting regulatory fragmentation, suggesting this will deprive users of valuable services or at the very least increase costs that ultimately consumers will have to pay for. They aren’t wrong. Regulatory diversity does lead to higher transaction costs. But their innocent-sounding warning on behalf of the world’s consumers is not only a bit self-serving. It’s also analytically flawed.

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