My latest paper on MDE is about this, a simple model in which acquisitions are contingent on payments shows the first effect, and a simple Cournot model illustrates the second. Hope you find it useful! www.researchgate.net/publication/...
a) payments are conditional on the acquisition or b) no pre-merger decisions are considered. If either of these conditions fails, the “take it or leave it” assumption is an extreme case and (sometimes) a very strong assumption (...)
The “take it or leave it” assumption is common in M&A models, since the bargaining process only determines the allocation of the surplus among the parties and simplifies the model, right? Yes, but it is a double-edged sword, since it is only true if (...)
...nor has incentive to do so. However, we can expect a reduction of content and providers, but not everywhere. Competitive markets and those with barriers to entry are more resilient to Google AI summaries. Why? In a recent published article, we answered this and more [2/3]
Google users who encounter an AI summary are less likely to click on links to other websites than users who do not see one. But Google won't kill the content market...[1/3]
www.pewresearch.org/short-reads/...
What happens if you put a full scientific paper into AI and ask it to find known errors in proofs, tables, etc?
Every model before o3 fails completely, o3 gets 21% (its better at proofs, worse at tables & figures). Progress & useful as a second opinion/co-intelligence, not yet autonomous science.
Paper on the economics of AI competition shows new AI models are adopted very rapidly but are not always substitutes for each other (better models in the same family often substitute, but others expand the pie). Also, people use a mix of models. andreyfradkin.com/assets/deman...
Papers on economics, AI and decision making are welcome, especially from PhD students or early career researchers.
Deadline is on May, 28. Save the date!
Submissions for ItAIS 2025 are now open!
This year, we have a special topic on Information Economics and Decision Analysis.
www.itais.org/conference/2...
Giulia Brancaccio and I are looking for a pre-doc to work with us on topics related to Industrial Organization and Trade
@nyu.edu
Ideally for two years starting in September
apply.interfolio.com/165860
#EconSky #EconRA
Near as I can tell the only people winning out of this are graduate students in macro and trade who needed a random shock to study causal effects.
In this paper Rob and I review Agent-Based Modeling in economics and finance and how it can be used to relax conventional assumptions in standard economic models. We suggest how ABMs might be used in the future to build more realistic models of the economy and examine potential hurdles.
Provoking, to say the least.
Economist @joshgans.bsky.social uses o1-pro to generate a (minor, fun) paper in an hour based on an idea of his, and it gets published in an appropriate peer reviewed journal, with adequate disclosure.
He ends with the same sentiment I am increasingly seeing from fellow academics: what now?
Competition policy that sets market power to 1980s levels would lower the stock market by 45%. The remainder, due to accumulated retained earnings (35%) and a lower risk-free rate (20%), is unaffected.
chain of thought is hilarious
(distilled deepseek 14b running via ollama)
Congrats! Keep up the good work!
The statement "I personally chose the price" says a lot about the impact of our profession.
It's a financial definition that appeals to a specific public, but that's not for us. Without considering the alternatives, that threshold says little. But I understand the mindset that if a single tech can earn half of Google's profits, it should be a breakthrough (like AGI)
Thanks for the recommendation. Although it's not my arena, it's interesting nonetheless!
I also rely on the AI summary most of the time because it's useful. However, it may have other unintended consequences. If we wish to evaluate the impact of a technology, we must know its consequences, and normally the bad ones are less noticiable than the good ones. That's my thought on the SM bias
Moreover, we find that there is a relationship between the number of creators pre- and post-GenAI and the "summarization effect". We hope this and other results may help others estimate the effect of GenAI in digital markets.
Competitive markets and those with high entry costs will be less affected. However, the extent of this effect depends on the diminishing or constant returns of developers.
Happy to share our latest work on GenAI and competition. #GenAI may reduce content and increase its price when it summarizes content that can be found on the Web, such as Wikipedia or news articles. But not all markets will suffer the same fate...
#EconSky
link.springer.com/article/10.1...
Hi! I'm Manuel, an economist working on platform competition, AI and market simulations. I mostly read but write little. Nonetheless, views are my own.
