Economics of Artificial Intelligence

An NBER conference on Economics of Artificial Intelligence took place in Toronto on September 13-14, 2018. Research Associates Ajay K. Agrawal, Joshua S. Gans and Avi Goldfarb of University of Toronto and Catherine Tucker of MIT organized the meeting, sponsored by the Alfred P. Sloan Foundation, CIFAR, and the Creative Destruction Lab. These researchers' papers were presented and discussed: Emilio Calvano, Vencenzo Denicolò, and Sergio Pastorello, University of Bologna, and Giacomo Calzolari, European University Institute Q-Learning to Cooperate AI algorithms are increasingly replacing human decision making in real marketplaces. To inform the debate on potential consequences, Calvano, Calzolari, Denicolò, and Pastorello run experiments with AI agents powered by reinforcement learning in controlled environments (computer simulations). In particular, the researchers study multi-agent interaction in the context of a workhorse oligopoly model: price competition with Logit demand and constant marginal costs.