Artificial Intelligence In The Central Bank: Benefits And Risks Of Public Administration

Abstract

The article analyzes the benefits and risks of using artificial intelligence (AI) in the public administration of central banks. Using the method of discourse analysis, the advantages and risks of introducing AI into the activities of central banks are investigated. The author also considers the Concept of Artificial Intelligence Development in Ukraine, approved by the Resolution of the Cabinet of Ministers of Ukraine № 1156-r dated 02.12.2020, which defines the priority areas of AI development and the areas to which this initiative is directed. Using AI in central banks can help improve the analysis of large amounts of data, which in turn will help forecast economic trends and manage financial risks. One of the main advantages is the ability to automate routine processes, allowing employees to focus on strategic tasks. An important aspect is the collection of microeconomic and non-economic data from various sources, including the Internet. In addition, AI provides the ability to use synthetic data, which expands the possibilities for analysis. However, the use of AI also carries significant risks. These include problems with data privacy, the risk of false conclusions based on synthetic data, the impact of built-in biases in AI models, and the difficulty of explaining policy decisions. Cybersecurity is a separate issue, as the introduction of AI makes systems more vulnerable to cyberattacks. AI is expected to be increasingly integrated into key functions of central banks, including monetary policy-making and financial risk management. This will allow central banks to make more informed decisions and increase the efficiency of their operations. In addition, the introduction of AI will facilitate the development of information technology and improve analytical capabilities, which will ultimately reduce the workload of employees. At the same time, an important part of the analysis is the impact of AI on the transformation of modern approaches to public administration, especially in the context of the digitalization of the economy. AI can change traditional management methods by offering new tools for decision-making, but it also requires more careful regulation to avoid negative consequences. Therefore, a balanced implementation of these technologies is needed, taking into account potential risks and benefits. This study is a step in understanding how artificial intelligence can change the role of central banks in the modern economy, and how regulatory approaches need to be adapted to ensure the safe and effective implementation of these technologies.