Events

(joint with Erik Madsen)

Abstract: The use of artificial intelligence (AI) summarization by online search platforms poses an existential threat to content providers (CPs). Increasingly, organic search content is being replaced by an ``overview'' – a synthesis of relevant content into a summary – produced by generative AI. This shift may potentially reduce traffic to CPs, thereby reducing incentives for production. Anti-trust authorities are rolling out regulation that forces platforms to allow CPs to opt out of summarization, without affecting their prominence in organic search results. We build a novel framework to explore the efficacy of such a regulation, wherein a platform contracts with CPs while also chosing how aggresively to summarize. When summarization is a weak substitute for search, the regulation is always effective at boosting the welfare of CPs. When summarization is strong substitute, the regulation may backfire and reduce CP welfare. The regulation typical induces the platform to switch to a pay-for-content model, combined with increased summarization.

The Economic Theory Lunchtime Workshops are convened by Meg Meyer.