The DeepSeek Paradox II
Other companies, such as Meta and Microsoft, could also benefit. While their AI investments may lose value temporarily, the faster and cheaper adoption of the technology could boost their businesses. Moreover, the global economy stands to gain from the reduced costs of AI, which could be seen as a positive productivity shock. Economist Olivier Blanchard even compared the impact of this innovation to the greatest productivity shock in history.
Finally, competition in the AI sector could increase, benefiting consumers. If a relatively small company like DeepSeek can challenge industry giants, it could lead to a fairer distribution of the technology's benefits, reducing the power of current oligopolies. Although major players in the sector may suffer in the short term, the competitiveness generated by DeepSeek could be positive for everyone in the long run.
