AGI is probably bad for startups, even if it doesn't lead to ASI

One of the great mysteries of capitalism is the nature of the "firm". It's a question that is near and dear to my heart as someone that's been "doing startups" for the last six years, and almost every startup founder has considered it whether they realize it or not. There are two ways of asking The Mystery of the Firm, depending on your initial inclination. The most generic way to ask it is: When and why do businesses transact with each other, instead of doing things in-house? What determines the shape and size of businesses, in different sectors of the economy? A more pointed way to ask the question is: Why isn't there just one big corporation? One Big Corporation would have a lot of advantages; it doesn't have to pay someone a gross margin on its inputs, it'd have massive advantages of scale in place like media or software, and (presumably) it'd have a much easier time sharing information between components that would ordinarily be different firms. Economists have many ways of answering this question. My preferred explanation, which is compatible with a lot of others, is that the primary bottleneck on firm size are Moral Mazes . Even large and well run companies like Google, whic