Related papers: The Economics of AI Supply Chain Regulation
The widespread adoption of AI in recent years has led to the emergence of AI supply chains: complex networks of AI actors contributing models, datasets, and more to the development of AI products and services. AI supply chains have many…
Using a model in which agents compete to develop a potentially dangerous new technology (AI), we study how changes in the pricing of factors of production (computational resources) affect agents' strategies, particularly their spending on…
We study markets where firms compete for consumer attention by subsidizing costly product inspection. These subsidies do not change product quality, but they alter the order in which consumers search by lowering inspection costs. We…
How does competition in markets for information affect the creation and division of surplus? We study this question in a search environment in which an agent searches sequentially for a high-quality good and learns about the quality of…
This paper examines the market for AI models in which firms compete to provide accurate model predictions and consumers exhibit heterogeneous preferences for model accuracy. We develop a consumer-firm duopoly model to analyze how…
We analyze the structure of the market for foundation models, i.e., large AI models such as those that power ChatGPT and that are adaptable to downstream uses, and we examine the implications for competition policy and regulation. We…
Traditional competitive markets do not account for negative externalities; indirect costs that some participants impose on others, such as the cost of over-appropriating a common-pool resource (which diminishes future stock, and thus…
The integration of AI Overviews into search engines enhances user experience but diverts traffic from content creators, potentially discouraging high-quality content creation and causing user attrition that undermines long-term search…
Consider a market of competing model providers selling query access to models with varying costs and capabilities. Customers submit problem instances and are willing to pay up to a budget for a verifiable solution. An arbitrageur…
Recent evidence, both in the lab and in the wild, suggests that the use of generative artificial intelligence reduces the diversity of content produced. The use of the same or similar AI models appears to lead to more homogeneous behavior.…
This paper examines how data inputs shape competition among artificial intelligences (AIs) in pricing games. The dataset assigns labels to consumers and divides them into different markets, thereby inducing multimarket contact among AIs. We…
Recent scholarly work has extensively examined the phenomenon of algorithmic collusion driven by AI-enabled pricing algorithms. However, online platforms commonly deploy recommender systems that influence how consumers discover and purchase…
The rise of AI has been rapid, becoming a leading sector for investment and promising disruptive impacts across the economy. Within the critical analysis of the economic impacts, AI has been aligned to the critical literature on data power…
Training advanced AI models requires large investments in computational resources, or compute. Yet, as hardware innovation reduces the price of compute and algorithmic advances make its use more efficient, the cost of training an AI model…
The race for artificial intelligence (AI) dominance often prioritizes scale over efficiency. Hyper-scaling is the common industry approach: larger models, more data, and as many computational resources as possible. Using more resources is a…
This paper develops a practical framework for using observational data to audit the consumer surplus effects of AI-driven decisions, specifically in targeted pricing and algorithmic lending. Traditional approaches first estimate demand…
Motivated by agentic markets -- two-sided markets in which consumers and businesses are assisted by AI tools that facilitate consumers' search -- we study the impact of improved search technology on learning and welfare in markets. We put…
Organizations increasingly need to reassess their supply chain strategies in the rapidly modernizing world towards sustainability. This is particularly true in the United States, where supply chains are very extensive and consume a large…
The use of dynamic pricing by profit-maximizing firms gives rise to demand fairness concerns, measured by discrepancies in consumer groups' demand responses to a given pricing strategy. Notably, dynamic pricing may result in buyer…
In the rapidly evolving landscape of eCommerce, Artificial Intelligence (AI) based pricing algorithms, particularly those utilizing Reinforcement Learning (RL), are becoming increasingly prevalent. This rise has led to an inextricable…