This completely breaks down under the current reality of AI investment, as players large and small are no longer price-takers. The marginal costs of investment are not constant because we have finite supplies of GPUs, TPUs, memory, hard drives, and power. The Hamiltonian in equations 5 and 6 needs to account for this.
Q: The J-dip is where capital stock is just about to overtake investment growth, why should it lag the hype trough where presumably value overtakes interest ?
This completely breaks down under the current reality of AI investment, as players large and small are no longer price-takers. The marginal costs of investment are not constant because we have finite supplies of GPUs, TPUs, memory, hard drives, and power. The Hamiltonian in equations 5 and 6 needs to account for this.
are you saying that previous technologies had effectively infinite supply?
No. I'm stating where the paper's assumptions are clearly violated.
AI companies are intentionally trying to monopolize the supply of inputs needed for R&D. This violates homogeneity of degree 1.
If you are one of those that are amused by attempts to synthesize paradigms, here's one that superposes J-curve on the hype curve
https://www.financialprofessionals.org/training-resources/re...
Q: The J-dip is where capital stock is just about to overtake investment growth, why should it lag the hype trough where presumably value overtakes interest ?