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Abstract
This paper explores the role of artificial intelligence (AI) within economic institutions, focusing on bounded rationality as understood by Herbert Simon. Artificial Intelligence can do many things in the economy, such as increasing productivity, enhancing innovation, creating new sectors and jobs, and improving living standards. One of the ways that AI can disrupt the economy is by reducing the problem of bounded rationality. AI can help overcome this problem by processing large amounts of data, finding patterns and insights, and making predictions and recommendations. This insight raises the question: can AI overcome planning problems – could it be that central planning is now a viable option for economic organisation? This paper argues that AI does not make central planning viable at either the nation-state level or the firm level, simply because AI cannot resolve the knowledge problem as described by Ludwig von Mises and Friedrich Hayek.

AbstractThere is a widespread concern that anti‐elitist or populist opinion is on the rise. The policy concern is that political opportunists would exploit voter rational ignorance for their own cynical purposes. In this article I demonstrate that, in the field of taxation, this sort of behaviour already occurs. Fiscal illusion can be described as deceiving taxpayer‐voters into paying more tax than they would otherwise agree to. Taxpayers are already victims of political opportunism unrelated to the rise of populism.

Discusses tax burden on high-income earners, the top 25 percent of the income distribution, who pay largest percent of income tax; impact of tax avoidance and evasion.