An Interview with Parallel Founder Parag Agarwal About Valuing Content on the Agentic Web

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Ben Thompson“What are Shapley values? Um, what's, explain, Eli Five, explain to me like I'm five. Parag AgarwalShapley values is this very general concept from cooperative game theory that if a few people end up collaborating together and creating a whole that is bigger than the sum of parts. Right now, the pie got larger. How do you divide up this pie among all of them to maximize incentive to participate in whatever this cooperation is? Ben ThompsonRight. Parag AgarwalSo Shapley was a Nobel Prize-winning economist, game theorist, who came up with this notion of Shapley values, which maximizes participation. Now, the really cool thing about this is that it also has been shown that outside of cooperative games, even open market mechanics where people are competing, right? Many of those situations also converge to people essentially extracting Shapley values from such collaboration or such markets, right? Ben ThompsonSo what, so what, what, what's the uncooperative game or the competitive game aspect is super important 'cause this is why this could sort of scale broadly, but just walk me, you did the sort of ABC example before. If we have 4 or 5, let's say the mini bundle or whatever, and we're selling something, you can sell it for more money, like, like just at a very high level. How do I figure out who's most responsible for the value there? Parag AgarwalSo, so let me walk through, uh, for an example, let's say you're trying to buy gloves, okay? A left glove and a right glove that makes a pair for you, right? You get value 1 if you get 1 left and 1 right glove, right? Let's say there are 3 people selling gloves. One of them has a left glove, 2 of them have a copy of the right glove each. All three of them show up to you and you're like, okay, how do I value the left glove versus the right glove? Like, how do I buy this? Turns out if you did the Shapley value math, you roughly end up paying them 4x for the left glove. Interesting. Ben ThompsonYeah, because it's the only one. Parag AgarwalThat's what the math leads to, right? And so that's an example which shows that if you have more differentiated, scarce commodity to bring to a marketplace, you will extract more value from it. Right?”