Amazon and Walmart AI shopping assistants can frequently identify when "Made in USA" product labels are false, but the major retailers are not using that technology to crack down on the listings, according to a recent study from a think tank headed by former US Federal Trade Commission chair Lina Khan.
The study raises concerns about the conflicting motives of AI shopping assistants because retailers view the technology as a means of increasing spending.
According to the study's authors, Amazon's Alexa for Shopping and Walmart's Sparky shopping assistants can identify discrepancies between clear "made in USA" statements and conflicting information in product descriptions, as reported by Reuters.
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When asked why businesses aren't doing more to stop misleading labelling, AI-driven chatbots have responded with commercial explanations. Walmart's Sparky said that the FTC usually enforces "made in USA" regulations against manufacturers, not retailers, in response to researchers' question on why it does not report dubious "made in USA" claims.
"That's a business calculation, not a legal justification," Walmart's chatbot said, according to the study. "Country-of-origin information, when available, is currently displayed on product detail pages, and we're continually working to improve Alexa for Shopping to make this information even more accessible for customers," a spokesperson for Amazon said.
After Khan returned to Columbia Law School following her time at the Federal Trade Commission, the Center for Law and the Economy released the first research.
"Even as AI tools continue to grow in sophistication and capability, business incentives will shape how these advancements get deployed. Policymakers and enforcers have a vital role to play to ensure the public doesn't get the short end of the stick," Khan said.
Products marketed as "made in USA" must be "all or virtually all" made in the US, according to FTC regulations. Citing business standards requiring sellers to give truthful information, the FTC last year encouraged Walmart and Amazon to take action against third-party sellers' "made in USA" claims.
The authors claim that when asked about the persistent false "made in USA" claims on the platform, Amazon's Alexa responded, "the harm to U.S.-made brands is real and documented, but until that harm creates a financial, regulatory, or reputational cost for Amazon specifically, it remains easier to do nothing."
The authors claim that when asked about the persistent false "made in USA" claims on the platform, Amazon's Alexa responded, "the harm to U.S.-made brands is real and documented, but until that harm creates a financial, regulatory, or reputational cost for Amazon specifically, it remains easier to do nothing."
According to the authors, Amazon's Alexa responded, "the harm to U.S.-made brands is real and documented, but until that harm creates a financial, regulatory, or reputational cost for Amazon specifically, it remains easier to do nothing," when questioned about the persistent false "made in USA" claims on the platform.
During her tenure at the FTC, Khan filed a lawsuit against Amazon, alleging that it possessed unlawful online retail monopolies. The case is still pending.
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