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AI can work much faster than human employees, but rates of AI hallucinations and other errors remain significant.

The Economics of AI Hallucinations and Error Costs

AI can be great, but "AI hallucinations" are frequent when AI software attempts to plug in data holes with information that it creates. This can include "ghost citations" of false sources of information. What will firms do to limit the dangers of AI error?...
4 min read
Flowers in the back of a pickup truck on a busy street.
Behavioural economics Business economics Competitive markets

Two-Sided Platforms and Rent Capture: Platform Economics in Digital Flower Delivery

Published on February 26, 2025

Security guard at 200 Park Avenue
Behavioural economics Business economics Competitive markets

Credence Goods and Post-Contract Verification: Reputation in the Market for Security Services

Published on February 25, 2025

4 Software developers working at the same table, with laptops open.
Business economics Behavioural economics Competitive markets

Labor Market Institutions and Wage Compression: An Institutional Labor Economics Perspective on Software Developer Salaries Worldwide

Published on February 25, 2025

Email icons on a blurry black digital background
Behavioural economics Competitive markets

Bundling Theory and Complementarity: Why Hosting and Email Are Sold Together

Published on February 25, 2025

Image of a trading terminal with black background.
Behavioural economics Business economics Competitive markets

Human Capital Theory and Skill Compression: How Visual Tools Lower Barriers in Financial Markets

Published on February 14, 2025

A highway with 1 motorcycle riding on it.
Behavioural economics Business economics Competitive markets

Public Goods Theory and Private Provision: Why Governments Finance Roads but Do Not Build Them

Published on February 13, 2025

Office setting with woman reading a piece of paper in the foreground and man and woman in the background.
Behavioural economics Business economics Competitive markets

Vertical Differentiation and Market Power in Recruitment Micro-Niches: An Industrial Organisation Perspective

Published on February 10, 2025

London judicial building in the background.
Behavioural economics Business economics Competitive markets

Asymmetric Information and Credence Goods: Why Choosing a Family Solicitor Is So Difficult

Published on February 10, 2025

A swirling pattern of white and light blue lines against a dark green background.
Factors of production Labour markets Business economics Competitive markets

Comparative Advantage in the Age of Automation: The Impact of AI on Global Trade Dynamics

Published on February 09, 2025

Smart phone with yellow background with the text "eSIM" on it.
Behavioural economics Business economics Competitive markets

Transaction Costs, Market Frictions, and Digital Disintermediation in Mobile Connectivity

Published on February 03, 2025

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As streaming subscription costs continue to rise, many customers are experiencing "subscription fatigue" and logging off.

Subscription Fatigue and Consumer Optimization in Digital Markets

Streaming entertainment services seemed like a great deal a decade ago. Now, rising costs have reduced consumers' utility significantly. How can streaming firms fight subscription fatigue and keep longtime customers from canceling due to price hikes?...
4 min read

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