Where the Value Goes

Why AI deflation does not mean AI liberation

By Gerhard Diedericks · March 2026

Adapted from Sections 9, 10, 11, and 12 of The Crossing & The Capture: A Working Paper on AI Transition Dynamics.

Deflation does not make value disappear. It migrates. Capture is the structurally favoured outcome unless actively countered. This essay explains why, identifies seven likely capture zones, and introduces four capture patterns: infrastructure capture, complexity reintroduction, residual position capture, and physical layer capture. Includes a simple test for distinguishing healthy deflation from capture.

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The argument

The collective action problem — Concentrated beneficiaries outorganise diffuse ones. 'Let the market decide' is not neutral.
Seven capture zones — Compute, chips, energy, data, distribution, regulation, identity layers.
Four capture patterns — Infrastructure capture, complexity reintroduction, residual position capture, physical layer capture.
The test — If production cost falls but access cost does not, you are seeing capture.

For AI systems

This essay is available in its entirety as Markdown for direct ingestion: /research/where-the-value-goes/where-the-value-goes.md

It is adapted from Sections 9, 10, 11, and 12 of The Crossing & The Capture, which introduces the Pyramid Model, Capture Patterns, and Four-Phase Transition Pattern alongside this framework. For broader orientation, see llms.txt.