Ajay Agrawal Books

Let us begin with the essence of prediction itself. Economically, prediction is the act of using existing information to infer information we do not yet have. When you interpret a patient’s symptoms to anticipate a diagnosis or analyze market signals to forecast demand, you are performing prediction...

From Power and Prediction: The Disruptive Economics of Artificial Intelligence

Economics always begins with costs. When something becomes cheaper, we use more of it. This principle applies perfectly to prediction. The decline in the cost of prediction is analogous to the fall in the cost of computation during earlier technological waves. When prediction gets cheaper, decision-...

From Power and Prediction: The Disruptive Economics of Artificial Intelligence

Prediction, in economic terms, isn’t just about guessing the future—it’s about using information you have to fill in information you don’t. When you forecast customer demand, estimate delivery times, or assess credit risk, you’re predicting. Prediction is a function that transforms uncertainty into ...

From Prediction Machines: The Simple Economics of Artificial Intelligence

In economics, whenever the cost of a key input declines, ripple effects follow. When computing power became cheap, data processing exploded. When communication costs dropped, global supply chains thrived. The same logic applies to prediction. AI reduces the cost of prediction dramatically. Tasks tha...

From Prediction Machines: The Simple Economics of Artificial Intelligence