Does company size affect innovation?

That's not our house. Wait a minute. That's our house.

Next:Economy Newsletter Modified image by David Sawyer on Flickr   Where memory ends and generative AI begins Sam Lawton, a 21-year-old film student from Nebraska, used OpenAI's DALL-E to alter childhood photos. He gave the tool various commands to embellish the images: to fill in the edges with trees, insert people who hadn't been there, and reimagine the kitchen. He then showed the images to his father and recorded his response: "No, that's not our house. Wow—wait a minute. That's our house. Something's wrong. I don't know what that is. Do I just not remember it?" "Where do real memories end and generative AI begin?" Lauren Goode asks in this Wired article. "It's a question for the AI era, where our holy photos merge with holey memories, where new pixels are generated whole cloth by artificial intelligence." + "8 Big Questions About AI" + Generative AI resources on O'Reilly   Does company size affect innovation? We are used to thinking about income inequality between individuals, but inequality between firms is vastly larger. In the US, the richest 1% of individuals earned about 20% of all income in 2018. In contrast, the top 1% of US firms by sales earned about 80% of all sales in 2018. The economy is populated by a few "superfirms" and a multitude of small- to medium-size businesses. And this disparity is getting more extreme over time. Does this huge disparity in firm size matter for innovation and technological progress? Do big firms differ in the type of R&D they do, and if so, why? In this post, Matt Clancy and Arnaud Dyèvre take a look at innovation and company size. Firm size and R&D rise proportionally, they say, but that doesn’t mean the rate of innovation stays the same. Larger companies file more patents, but their innovations could be considered incremental. So business consolidation, while not altering the total amount of funding for R&D, could slow the rate of transformative innovation. + Deeper Reading: The New Goliaths, by James Bessen makes the point that one key to superstar firms is that, regardless of their industry, they use software to better manage complexity than their rivals. For example, while all big box stores benefit from scale, Walmart outcompeted all the rest by using IT to manage both economies of scale and localized, targeted selections better suited for local needs.   Working alongside AI makes workers happier Most of the discussion of AI and human workers centers around the idea that jobs will be lost. But if implemented correctly, AI can augment rather than replace workers and, in doing so, can make human jobs less tedious and more satisfying. A recent CNBC workforce survey found that workers who rely on AI for their jobs have a "Workforce Happiness Index" of 78—seven points higher than among those who don't use AI at all at their jobs. And compared with those who don't use AI at all, workers who say using AI is necessary to do their job are also more likely to say their salary has increased more than inflation in the past year (33% versus 10%) and to rate morale at their workplace as excellent (50% versus 27%). + On the other hand, not all AI-adjacent jobs are rewarding. Tagging or annotating data to train AI is boring beyond belief. And while in theory, human annotators may someday be unnecessary, they are currently in great demand (but not well paid). + The last AI boom didn't kill jobs. + "The People Paid to Train AI Are Outsourcing Their Work… to AI."   Beyoncé's impact on the economy Did Beyoncé spike Sweden's inflation? Economist Michael Grahn says she did, but he expects it to cool once her concert is over. This message was sent to alexvarboffin.abbb@blogger.com. You are receiving this because you've signed up to receive email from us. Privacy Policy | Unsubscribe From All | Unsubscribe From Next:Economy O'Reilly Media, Inc., 1005 Gravenstein Highway North, Sebastopol, CA, 95472 (707) 827-7000