
#Mastodon: @TedRalphs@sigmoid.social #BlueSky: @tedralphs.bsky.social Professor, Industrial and Systems Engineering, Lehigh University. Do math, write code.
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![Measuring and Mitigating Racial Bias in Large Language Model Mortgage Underwriting
Donald E. Bowen III (Lehigh University)
S. McKay Price (Lehigh University)
Luke C.D. Stein (Babson College)
Ke Yang (Lehigh University)
We conduct an audit study of loan approval and interest rate decisions suggested by large language models (LLMs). Using a dataset of real loan applications and experimentally manipulated race and credit scores, we find that LLMs recommend denying more loans and charging higher interest rates to Black applicants than otherwise-identical white applicants. This racial bias is largest for lower-credit-score applicants and riskier loans, but present across the credit spectrum. Surprisingly, simply instructing the LLM to make unbiased decisions eliminates the racial disparity in approvals and moderates the interest rate disparity. …
[Abstract text truncated due to Twitter's silly alt text character limits. Full text at lukeste.in/llmbias ]](https://pbs.twimg.com/media/GPJ_5tDWAAAM4jh.jpg?name=small&format=webp)
ALT Measuring and Mitigating Racial Bias in Large Language Model Mortgage Underwriting Donald E. Bowen III (Lehigh University) S. McKay Price (Lehigh University) Luke C.D. Stein (Babson College) Ke Yang (Lehigh University) We conduct an audit study of loan approval and interest rate decisions suggested by large language models (LLMs). Using a dataset of real loan applications and experimentally manipulated race and credit scores, we find that LLMs recommend denying more loans and charging higher interest rates to Black applicants than otherwise-identical white applicants. This racial bias is largest for lower-credit-score applicants and riskier loans, but present across the credit spectrum. Surprisingly, simply instructing the LLM to make unbiased decisions eliminates the racial disparity in approvals and moderates the interest rate disparity. … [Abstract text truncated due to Twitter's silly alt text character limits. Full text at lukeste.in/llmbias ]




