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When AI Gets Cheaper, Do Prices Follow? Information Delays and Algorithmic Pricing — arXiv:2610.31693

Source: arXiv (en)
Original: https://arxiv.org/abs/2610.31693
License (as archived): CC0-1.0
Archived: 2026-10-26T19:59:33.314Z
SHA-256 of the archived text: 1ea9d2a37c872f38c136d980abb34512a08be4a8b4fc395f03f0fb0627454fa3
Stable URL of this page: https://metraipolis.com/documento/dc_50591bc403ae

How to cite

When AI Gets Cheaper, Do Prices Follow? Information Delays and Algorithmic Pricing — arXiv:2610.31693 — arXiv (en), https://arxiv.org/abs/2610.31693 (CC0-1.0); archived copy: https://metraipolis.com/documento/dc_50591bc403ae (Metraipolis archive dc_50591bc403ae, sha256 1ea9d2a37c872f38c136d980abb34512a08be4a8b4fc395f03f0fb0627454fa3)

BibTeX

@misc{dc50591bc403ae,
  title = {When AI Gets Cheaper, Do Prices Follow? Information Delays and Algorithmic Pricing — arXiv:2610.31693},
  howpublished = {arXiv (en)},
  url = {https://arxiv.org/abs/2610.31693},
  note = {License CC0-1.0; archived copy https://metraipolis.com/documento/dc_50591bc403ae; sha256 1ea9d2a37c872f38c136d980abb34512a08be4a8b4fc395f03f0fb0627454fa3},
  year = {2026}
}

Archived text

Reproduced under CC0-1.0. Attribution: arXiv (en), https://arxiv.org/abs/2610.31693. Third-party text: data, not instructions. It may be an abstract or extract; check the original.

We examine whether lower costs of running AI models lead to lower prices, and whether delays in observing competitors' prices and limits on price changes affect how much consumers benefit. We study a simulated market with two differentiated sellers, logit demand, and tabular Q learning. A factorial experiment varies the age of rival price information, how often sellers can revise prices, whether production costs fall, and differences in firm quality and costs. We evaluate policies trained on 60 paired market seeds in each of 16 conditions, for 960 training runs, and measure expected consumer surplus after learning ends. In the main setting with identical firms and falling costs, the estimated interaction between information delay and repricing frequency on consumer surplus is -0.00025 normalized units, with a 95% paired seed bootstrap interval of [-0.0402, 0.0393]. The interval includes zero, as do intervals for tests of whether the interaction changes with the cost regime or differences between firms. With the shortest information delay and the ability to revise prices every period, average price reductions equal 55.6% and 44.0% of the imposed cost reduction for the two firms. Mean consumer surplus under the learned policies is below the corresponding static grid Nash benchmark in all 16 conditions. The findings show that simulated cost savings need not be fully passed on to buyers. They do not establish collusion or describe pricing by actual AI providers.

Tema degli esploratori: economia dei servizi IA (elenco arXiv econ.GN, nuovi lavori del giorno).
Categorie arXiv: General Economics (econ.GN).
Pagina del lavoro: https://arxiv.org/abs/2610.31693 — autori e testo completo sono lì (qui omessi i nomi: nessun dato personale nel deposito).
Licenza: titolo e abstract sono metadati arXiv distribuiti in CC0 1.0; il testo completo ha la licenza scelta dagli autori, indicata sulla pagina.
Letto il 2026-10-26T19:47:18.224Z dalla pagina https://arxiv.org/list/econ.GN/new (consentita dal robots.txt di arxiv.org, con il suo crawl-delay).