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The Rise of AI Pricing: Trends, Driving Forces, and Implications for Firm Performance

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Abstract

We document key stylized facts about the time-series trends and cross-sectional distributions AI pricing and study its implications for firm performance, both on average and in response to monetary policy shocks. We use the online job postings data from Lightcast to measure the adoption of AI pricing. We infer that a firm is adopting AI pricing if it posts a job that requires AI-related skills and contains the keyword “pricing.” At the aggregate level, the share of AI pricing jobs in all pricing jobs has increased more than tenfold since 2010. The rise of AI pricing jobs has been broad-based, spreading across more industries than other types of AI jobs. At the firm level, larger and more productive firms are more likely to adopt AI pricing. Firms that adopted AI pricing experienced faster growth in sales, employment, assets, and markups, and their stock returns are also more responsive to high-frequency monetary policy surprises than non-adopters. We show that these empirical observations can be rationalized by a simple model where a monopolist firm with incomplete information about its demand function invests in AI pricing to acquire information.

Suggested Citation

  • Jonathan Adams & Min Fang & Zheng Liu & Yajie Wang, 2025. "The Rise of AI Pricing: Trends, Driving Forces, and Implications for Firm Performance," Working Paper Series 2024-33, Federal Reserve Bank of San Francisco.
    • Handle: RePEc:fip:fedfwp:99052
    DOI: 10.24148/wp2024-33
    Note: Original publication date: 2024-11-12
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    Cited by:

    1. Alexander Kohlhas & Vladimir Asriyan, 2025. "The Macroeconomics of Data: Scale, Product Choice, and Pricing in the Information Age," Working Papers 1486, Barcelona School of Economics.
    2. Alexandre Kohlhas & Vladimir Asriyan, 2025. "The Macroeconomics of Data: Scale, Product Choice, and Pricing in the Information Age," Economics Series Working Papers 1073, University of Oxford, Department of Economics.
    3. Vladimir Asriyan & Alexandre Kohlhas, 2025. "The macroeconomics of data: Scale, product choice, and pricing in the information age," Economics Working Papers 1904, Department of Economics and Business, Universitat Pompeu Fabra.

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    Keywords

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    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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