The Synthetic Mirror -- Synthetic Data at the Age of Agentic AI

Abstract

Synthetic data, which is artificially generated and intelligently mimicking or supplementing the real-world data, is increasingly used. The proliferation of AI agents and the adoption of synthetic data create a synthetic mirror that conceptualizes a representation and potential distortion of reality, thus generating trust and accountability deficits. This paper explores the implications for privacy and policymaking stemming from synthetic data generation, and the urgent need for new policy instruments and legal framework adaptation to ensure appropriate levels of trust and accountability for AI agents relying on synthetic data. Rather than creating entirely new policy or legal regimes, the most practical approach involves targeted amendments to existing frameworks, recognizing synthetic data as a distinct regulatory category with unique characteristics.