Abstract
This paper proposes the Data-to-Wisdom Epistemic Architecture for AI (EAAI), a conceptual framework treating Data, Information, Knowledge, Understanding and Wisdom as five distinct but recursively interacting epistemic functions: observation, contextual interpretation, modeling and prediction, critical evaluation and informed judgment. Two observations motivate it: sequential readings of the Knowledge Pyramid obscure how these functions interact, and a targeted review of ten Bayesian reference books finds that prior distributions are defined mathematically while "prior information" and "prior knowledge" are not consistently distinguished as epistemic categories. A Bayesian interpretation relates the likelihood, prior and posterior distributions, posterior prediction, model checking and decision analysis to the five functions, without limiting EAAI to Bayesian systems. Extending "prior" in an epistemic sense, the paper distinguishes five kinds of prior context that can shape the model, the likelihood, the prior, evaluation and action. Three worked applications -- quantitative financial risk, actuarial modeling in health insurance and agentic AI for medical reimbursement claims -- show how EAAI structures the analysis of model assumptions, evidence interpretation, validation, dependencies and decision consequences, separating the prediction of a risk, the appraisal of its reliability and the justification of action. It draws implications for AI and machine learning, including evaluation by function, treating intermediate model outputs as evidence open to challenge and separating generation from appraisal, and compares EAAI with work on DIKW, Bayesian workflow, AI evaluation and risk governance. Its contributions are an epistemic vocabulary with recursive relationships, a more accessible reading of Bayesian methodology, a typology of prior context and clearer methodological terminology.
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URL
https://arxiv.org/abs/2611.16726
