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This paper addresses the economic incentives of content creation in an AI-driven environment where Large Language Models amplify positive spillovers from reused data. It proposes novel "Provisional Allocation" mechanisms to stabilize creator effort levels and maximize social welfare within this new dynamic landscape. The work is significant for understanding how platform design must evolve as training data increasingly relies on aggregated user contributions rather than isolated inputs.
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Content Creation with Spillovers: An Incentive Design Approach

arXiv2 min read

arXiv:2603.14372v2 Announce Type: replace Abstract: The rise of AI amplifies the economic phenomenon of \emph{positive spillovers}: when creators contribute content that can be reused and adapted by LLMs, one creator's effort may improve the content quality of others through recombination. While such spillovers can improve content quality, they also reshape incentives, as creators may reduce effort when they can benefit from others' contributions. We introduce the \emph{Content Creation with Spillovers} (CCS) model, a game between a platform and strategic creators. In this game, each creator chooses an effort level, and qualities are jointly determined by all creators' efforts. The platform contracts on qualities while seeking to maximize social welfare. We show that standard contest mechanisms can be unstable, and propose a parametrized family of \emph{Provisional Allocation} mechanisms that guarantee a Pareto-dominant equilibrium. Although optimizing welfare within this family is hard to approximate in general, we develop approximation algorithms whose guarantees hold either deterministically across structured spillover classes or with high probability under random instances.

Abstract:The rise of AI amplifies the economic phenomenon of \emph{positive spillovers}: when creators contribute content that can be reused and adapted by LLMs, one creator's effort may improve the content quality of others through recombination. While such spillovers can improve content quality, they also reshape incentives, as creators may reduce effort when they can benefit from others' contributions. We introduce the \emph{Content Creation with Spillovers} (CCS) model, a game between a platform and strategic creators. In this game, each creator chooses an effort level, and qualities are jointly determined by all creators' efforts. The platform contracts on qualities while seeking to maximize social welfare. We show that standard contest mechanisms can be unstable, and propose a parametrized family of \emph{Provisional Allocation} mechanisms that guarantee a Pareto-dominant equilibrium. Although optimizing welfare within this family is hard to approximate in general, we develop approximation algorithms whose guarantees hold either deterministically across structured spillover classes or with high probability under random instances.

Artificial Intelligence (cs.AI)

arXiv:2603.14372 [cs.AI]

(or arXiv:2603.14372v2 [cs.AI] for this version)

https://doi.org/10.48550/arXiv.2603.14372 Focus to learn more arXiv-issued DOI via DataCite

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Full text under the publisher's open licence · 251 words

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