“The primary mechanism here is reinforcement learning with human feedback. These systems require human input to guide them in determining what is correct and incorrect before they can be completely automated. Currently, the pursuit of cost savings is the major driver behind what I’m witnessing. This approach is an example of short-term thinking, which is unproductive. It leads to a ‘race to the bottom’ in every industry that begins to implement generative AI for cost savings. You lose any comparative advantage once one company in an industry adopts this strategy, as all competitors will inevitably follow suit. This potentially initiates a contraction in the overall market for goods and services.”