The boundaries of artificial intelligence protection -Part 2

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Si Gyeongmin

Sep 20, 2021

(2) Artificial intelligence assistants as agents of perfect competition

Although the prospect of moving towards perfect competition has inspired decades of policy reforms, the results have been disappointing. Although prices and products can be seen at the click of a button, consumers often cannot choose the best price. Although information technology has reduced certain transaction costs and information asymmetry, technological innovation has enhanced the company's ability to profit from conversion costs, information asymmetry, and decision-making bias. Therefore, consumers tend to pay more than when the market is close to perfect competition.

Artificial intelligence assistants will actively protect consumers to ensure that consumers are not misled by intermediaries. When the unfavorable factors are controlled, there is huge potential for consumer welfare and efficiency improvement. The current dominant legal model, giving priority to reducing transaction costs, will theoretically support legal reforms, making advances in artificial intelligence possible.


2. The battlefield of law and market

The laws of automated trading are new, evolving, and untheorized. The extent to which the intellectual framework that supports artificial intelligence will translate into real-world policies is uncertain. Major US policymakers have expressed support for artificial intelligence assistants, but the speed of advancing the law has been slower than their counterparts in other countries. The laws that control business behavior will have a particularly large impact on the ability of artificial intelligence assistants to reduce transaction costs. This is divided into four areas: data blocking, exit prevention, confusion, and collusion.

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