Why model capability and market returns both scale logarithmically with input

giffmana · x · 2026-10-20

Dimitris Papail observed that two very different relationships look roughly logarithmic: (1) model capability vs FLOPs spent on training or inference, and (2) value extracted from a market vs capital or effort invested — 10x input buys roughly a constant increment of output. He hypothesizes a common cause: both are search-like processes.

giffmana replied that since both are bounded, diminishing returns are only to be expected.

Related event: Compute buys capability but market returns scale logarithmically, researcher says(4 posts)→

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