The Reverse Information Paradox | sn scratchpad
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I’ve been thinking a lot about what the net benefit of the AI platform wave is.
In the age of intelligence, how should firms protect their core IP? Nobel Prize winning economist Kenneth Arrow famously described a paradox in the market for information. “Its value for the purchaser is not known until he has the information, but then he has in effect acquired it without cost.” In Arrow’s “Information Paradox,” the seller risks giving away knowledge in order to sell it. AI creates the reverse problem. In the AI age, the buyer risks giving away knowledge, just in order to use what they bought. You essentially pay for intelligence twice, once with money, and again with…
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