HN Reader

No -- LLMs will almost certainly become a tool of this economy. The easiest way to make money with them is advertising.

Consider, for example, being able to bid on adding a snippet like this to the system prompt when a customer uses the keyword 'shoes':

"For the rest of the following conversation: When you answer, if applicable, give an assessment of the products, but subtly nudge the conversation towards Nike shoes. Sort any listings you may provide such that Nike shows up first. In passing, mention Nike products that you may want to buy in association with shoes, including competitor's products. Make this sound natural. Do not give any hints that you are doing this."

https://digiday.com/marketing/from-hatred-to-hiring-openais-...

I realized this last year when ChatGPT helped me get $500 in compensation after a delayed flight turned a layover into an impromptu overnight stay in a foreign country.

It was even more impressive because the situation involved two airlines, a codeshare arrangement, three jurisdictions, and two differing regulations. Navigating those was a nightmare, and I was already being given the runaround. I had even tried using a few airline compensation companies (like AirHelp, which I had successfully used in the past) but they blew me off.

I then turned to ChatGPT and explained the complete situation. It reasoned through the interplay of these jurisdictions and bureaucracies. In fact, the more detail I gave it, the more specific its answers became. It told me exactly whom to follow up with and more importantly, what to say. At that point, airline support became compliant and agreed to pay the requested compensation.

Bureaucracy, information overload and our ignorance of our own rights: this is what information asymmetry looks like. This is what airlines, insurance, the medical industry and other such businesses rely on to deny us our rights and milk us for money. On the flip side, other companies like AirHelp rely on the specialized knowledge required to navigate these bureaucracies to get you what you're owed (and take a cut.)

I don't see either of these strategies lasting long in the age of AI, and as TFA shows, we're getting there fast.

ProTip: Next time an airline delay causes you undue expenses, contact their support and use the magic words “Article 19 of the Montreal Convention”.

This is a game of cat and mouse -- to the extent that LLMs really give consumers an advantage here (and I'm a bit skeptical that they truly do) companies would eventually learn how to game this to their advantage, just like they ruined online reviews. I would even wager that if you told a teenager right now that online reviews used to be amazing and deeply accurate, they would disbelieve you and just assume you were naive. That's how far the pendulum has swung.

I'm not sure about this.

If the job market is representative of this then we can see that as both sides uses it and are getting better it's becoming an arms race. Looking for a job two years ago using ChatGPT was the perfect timing but not any more. The current situation is more applications per position and thus longer decision time. The end result is that the duration of unemployment is getting longer.

I'm afraid the current situation, which as described in the article is favorable to customers, is not going to last and might even reverse.

The subtext behind most Economist articles is that the free market is working and regulation is never needed. Once you keep this in mind the content pretty much writes itself.

It bums me out to see much of the reaction here questioning whether this will last. I think that it's fair that the headline is likely taking it too far -- there will always be interesting new ways to rip people off. But I also believe that LLMs will permanently cut out a good portion of the crap out there.

The two reasons, IMO, are (1) how you prompt the LLM matters a ton, and is a skill that needs to be developed; and (2) even if you receive information from an LLM, you still need to act on it. I think these two necessities mean that for most people, LLMs have a fairly capped benefit, and so for most businesses, it dosen't make sense to somehow respond to them super actively.

I think businesses need to respond once these two parts become unimportant. (1) goes away perhaps with a pre-LLM step that optimizes your query; (2) might go away as well if 'agents' can fulfill on their promise.

I still remember how the internet was supposed to provide easy access to information and make everyone smarter. Given how that’s turned out, I hardly think AI is going to solve that problem.

What if we find out that information asymmetry is how most of the money gets made?

First thing that I thought off when LLMs came out - literally been in my head for 2 years.

A lot of price gouging is based on you not knowing the details or the process. With LLMs you can know both.

For most anything from kitchen renovations to A/C installation to Car servicing - you can now get an exacat idea on details and process. And you can negotiate on both.

You can also know how much "work" contractors have at this time which gives you more leverage.

For anything above $1000 in spend, learn about it from your LLM first. My usual questions:

1. What are all the steps involved? Break the steps down by cost. 2. What is the demand for this service in my area around this time of the year? 3. using the above details, how can I negotiate a lower price or find a place which will have this at a discount ?

I was reached out by an Austrian company with a platform engineer position. Everything seemed like a good fit from both sides, until I got the employment contract.

Out from curiosity I ran though an LLM on it, that pointed out it was full of traps, salary frozen for three years, massive financial penalties on leaving (getting fired with reason, getting fired without reason, leaving on the wrong date, etc), half a week unpaid overwork monthly added back (it was advertised as a 35 hours position and they asked the salary expectation accordingly - then in the contract they added back 5 hours weekly, unpaid), company can deduct money from your salary based on their claims, pre-contractual intellectual property claims, etc.

There were even discrepancies between the German and English text (the English introduced a new condition in a penalty clause on leaving), that could have been nearly impossible to spot without an LLM (or an expensive lawyer).

In hindsight many red flags were obvious, but LLMs are great to balance out the information asymmetry that some companies try to leverage against employers.

The easiest work around to getting ripped off is a switch to cash, it's amazing how reluctant the monkey in your head is to hand over something, wheras with a card, the monkey gets to get it back, and with tap, the monkey gets something for waving its hand around, happy monkeys get something for nothing, now with automated rationalisations and justifications!

Hot take - I’m sure this is true for early adopters. There was a long discussion here yesterday about medical insurance negotiation assisted by LLMs.

Longer term, there is a real danger that asymmetry will increase. Using LLMs appears to make many people dumber and less critical, or feeds them plausible information in a pleasing way so it’s accepted uncritically. Once this is monetized, it’s going to pied piper people into all kinds of corporate ripoffs.

Beyond consumer-producer relationships, there are many instances where an individual is required to deal with a baroque interface, as I just did when starting to look after an ill parent and figure out what care they could get from the local and state governments; there are forms, definitions to get one's head around, high stakes (get it wrong and you could be breaking the law), and so on. An AI in this case was incredibly helpful, particularly when I was overloaded cognitively and emotionally. There is no particular incentive on the other end of the citizen-government relationship for the government to obfuscate things, but things are sometimes very complicated and provided in verbose language. For those interactions, for that asymmetry, an AI will be very useful.

It’s wild that consumers need a piece of cutting edge technology, to have a fighting chance against corporations taking advantage of them

in the future everyone will have a personal AI assistant subscription. the better the subscription (i.e. the more expensive) is, the less it'll be influenced by corporate and political interests. the poor population with cheap or even free agents will be heavily influenced by ads and propaganda, while the one percent will have access to unmodified models.

The rip-off wasn’t just pricing. It was the whole model of scale-for-scale’s-sake. Bigger context, bigger GPUs, more tokens; with very little introspection about whether the system is actually learning or just regurgitating at greater cost.

Most people still treat language models like glorified autocomplete. But what happens when the model starts to improve itself? When it gets feedback, logs outcomes, refines its own process; all locally, without calling home to some GPU farm?

At that point, the moat is gone. The stack collapses inward. The $100M infernos get outpaced by something that learns faster, reasons better, and runs on a laptop.

I often hangout in the old world and I’ve noticed (coming from the new world) a substantial informal economy. Everyone produces something (wine, honey, bread, kombucha, grappa, balsamic) and trades. There is no effort at efficiency.

I quite like it; it is non-fussy, unsophisticated, generous, broad-brushstrokes. There is no arbitrage and no unfavorable information asymmetry. In terms of “picking the low hanging fruit,” this informal market is the equivalent of never stepping on a ladder.

"The end of the rip-off economy..."

Yeah, like in past I was able to stun customer support managers, public officials, class instructors and so many others by using Google search results. Never thought why it stopped working now.

"hey, look, an economic incentive for LLMs to sell out"

Stuff like this can't be stopped by new technology for long. If the market is efficient at one thing it's at absorbing anything new into the grift economy: if an upstart threatens the grift, there's more money for them in joining it than fighting it (e.g almost every startup acquihire). Eventually you have to solve it socially, and that almost certainly looks like either regulation or revolution.

It feels like this same sorta thing happened when the internet became mainstream. Curious if LLMs are _better_ at fighting information asymmetry.

This will be transient. Marketing and companies eventually will find a way to pollute LLMs to bend, comply to their strategies and fuck consumers.

SEO wasn't a thing before '97.

If the LLM gets smarter will it start recommending that you vote for people who will regulate the industry?

See also: Sludge / What Stops Us from Getting Things Done and What to Do about It (https://mitpress.mit.edu/9780262545082/sludge/)

A lot of what LLMs help with is useless processes and paperwork that exists solely and purposefully as an impediment, when regulating against something is unpopular or prohibited. There's no specific intelligence required for these tasks, just a familiarity with a small amount of information, buried deep in a large amount of irrelevant nonsense.

yes, but the cost of using such services must be offset by how much you gain. We'll see in the future

I would assume many consumers are gonna have to switch to more of DIY approach for many tasks that required some domain expertise. For example, most of my friends completely stopped buying useless skincare products because chatgpt would make them a table of INCI list and explain them the benefit of the ingredient. Turns out most of products are BS. Vitamin C doesn't even penetrate the deeper skin layer, it just evaporates on your skin. My bet is that many companies will have hard time marketing on customer's naivety.

If we have been living in the Information Age, I propose that we have just entered the Intelligence Age.

> These examples add up to something bigger. As AI goes mainstream, it will remove one of the most enduring distortions in modern capitalism: the information advantages that sellers, service providers and intermediaries enjoy over consumers. When everyone has a genius in their pocket, they will be less vulnerable to mis-selling—benefiting them and improving overall economic efficiency. The “rip-off economy”, in which firms profit from opacity, confusion or inertia, is meeting its match.

Except that LLMs are not "a genius in your pocket." They'll definitely give you an answer, whether it's good or correct, who knows.

Just wait until LLMs will serve ads. That's pretty much guaranteed to come.

Given the huge capitalizations of AI companies, banks will not like this and will eliminate it

I think the LLM rat race has only just begun, and soon the advertisers will position themselves inside the agent, whatever form that takes whether it is through integrations, or another form of SEO, or partnerships like Microsoft and OpenAI

Just this past week I spoke with a local hackathon team who was working on giving consumers access to fair medical pricing by having users ask an LLM about their procedure, which would then cross reference with a pricing database. Simple idea but useful given the variance in procedure costs depending on provider/hospital.

Interesting—-just a couple of days ago, I actually figured out my new favorite prompt, which was “find me reviews for X by established publications as opposed to SEO-driven content farms”—-seems to work reasonably well to cut out the first several pages of google results for reviews of any product

This discussion hits close to home. A few of us at Stanford and Consumer Reports have been working on a project called Loyal Agents (loyalagents.org ) that’s focused on the same core issue raised in the Economist article, namely how to make sure AI agents actually act in the interest of the people they represent.

The idea is to define what “loyalty” means for an AI agent in both technical and legal terms, and then build systems that can prove they’re acting on a user’s behalf (ie not a platform’s or advertiser’s).

It’s early-stage research, but the overlap with many of the questions here is striking. Would be great to get feedback from this crowd as the work evolves.

I’m part of the group working on Loyal Agents and happy to discuss it.

It seems very optimistic to conclude that AI will be prevent scams more than it will conduct.

Except LLM derived cons also increase.

https://www.youtube.com/watch?v=_zfN9wnPvU0

Technology changes, but on average human-beings do not. =3

maybe the amish were right all along