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The high costs of data centers has limited the expansion of AI for now, creating an oligopoly market.

Compute Constraints and the New Economics of Scarcity in AI

AI is here and creating wonders, but it's not expanding as rapidly as many first predicted. The reason is significant cost and supply constraints, limiting AI data centers to only a handful of large firms. What are the economic implications of this AI bottleneck?...
4 min read
Abstract AI brain represented in polycules.
Behavioural economics Business economics Competitive markets

Transaction Cost Economics and Institutional Lag: Why AI “Humanizer” Tools Thrive in Rapid Innovation Markets

Published on January 16, 2025

Two people working on a laptop, one hand pointing at the screen.
Business economics Behavioural economics Competitive markets

Bundling Theory and Complementarity: How Value Is Created Beyond the Core Product

Published on January 15, 2025

Man sitting on a scooter looking at his phone
Behavioural economics Business economics Competitive markets

The Gig Economy Revolution: Freedom or Precarity?

Published on December 29, 2024

Windfarm at dusk on a green hillside.
Behavioural economics Business economics Competitive markets

Externalities and Pigouvian Policy: Pricing the Full Social Cost of Green Energy in Europe

Published on December 27, 2024

Bundled cardboard boxes with blue tape over them
Behavioural economics Business economics Competitive markets

Economies of Scale and the Socialization of Fixed Costs: Why Size No Longer Belongs Only to Firms

Published on December 25, 2024

Examples of Threats in SWOT Analysis
Definitions Business economics

Examples of Threats in SWOT Analysis

Published on December 16, 2024

The 1973 Oil Crisis and Shell's Scenario Planning
Business economics

The 1973 Oil Crisis and Shell's Scenario Planning

Published on December 14, 2024

Picture of monopoly houses on sheets of paper with graphs
Definitions Business economics

Proportional Tax

Published on December 06, 2024

Orange toy bot sitting on the edge of a desk with post its behind it.
Behavioural economics Business economics Competitive markets

Long Tail of AI Services: When Every Micro-Niche Gets a Bot — An Application of Long-Tail Markets & Love-of-Variety Economics

Published on December 05, 2024

AI Robot at an abstract desk with a blue laptop open.
Behavioural economics Business economics Competitive markets

Global Wage Arbitrage vs. Algorithmic Arbitrage: How AI Rewrites Comparative Advantage in the Homework Economy

Published on December 05, 2024

Newer Posts
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We all have the same 24 hours in a day, meaning our attention is a valuable asset to advertisers!

Attention Markets and the Economics of Time Scarcity

Firms have only limited human attention spans to advertise to, creating attention markets that lead to rising advertising costs. As platforms capture more consumers' attention, what are the economic effects of potential monopolies on this attention?...
4 min read

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