Envy And The Future of Work

One of the things that we like to do at Konvoy is invest in constants: things that remain the same generation after generation. People will always have a desire for entertainment, which is why games play a major role in our thesis. But we see this trend in other areas as well. For example, some of our recent theses have revolved around the idea of Trust, another idea that has been at the center of human-to-human interactions and societies since their formation.

As AI becomes increasingly prevalent throughout our society and the pace of change grows so pronounced, we want to take a step back and ask ourselves: what will remain constant even in such an uncertain future? If AI and robotics are increasingly commoditizing the work that humans have done for so long, what becomes valuable and what becomes scarce?

This week, we want to take a deeper dive into the future of work and why we believe that envy and basic human needs are the best indicators of what lies ahead, as they have remained constant over time. Alex Imas, a Professor of Behavioral Science, Economics, and Applied AI at the University of Chicago, put together a very thoughtful piece on what a world could look like where AI commoditizes production. We will summarize parts of that below, then dive into how this has happened in gaming, and what this means for where the next most valuable companies may come from.

Why Some Sectors Become A Larger Part of the Economy

When AI automates and commoditizes production in a sector, prices in that sector tend to fall. When this happens at scale, real incomes increase. The new dollars that are saved tend to flow into industries with what Alex Imas calls high income elasticity. These are industries in which demand changes little as income rises.

For example, agriculture has low income elasticity because you are only capable of eating so much food, whereas many services have high income elasticity because there's always a better restaurant or a more engaging experience to be had.

So as more dollars flow into these income elastic industries, and if that sector remains difficult to automate, it will naturally represent a larger portion of the economic pie.

Based on this, the services industry as a whole, which is fairly income elastic, will capture a larger share of the economic pie over time. This is already being seen in the behavior of the wealthiest Americans; however, not all service companies are income elastic, so determining which are is key to figuring out where value is likely to accrue in the economy over time.

Imas points out that anything comparative by nature (envy) is inherently income elastic. As we see other people enjoy better food, experiences, and goods, the desire for better food, experiences, and goods only compounds. This is called mimetic desire: the idea that we don’t desire objects only for their intrinsic properties, but because other people desire them as well. This appears to be an insatiable part of human nature, one that has remained constant over time.

If AI continues to commoditize most workflows, the end result will be a services-heavy economy, with the most value accruing to businesses and services that can absorb immense amounts of value driven by the insatiable nature demand from their memetic properties, such as exclusivity, relationships, and status. This is likely to be the most pronounced with luxury goods and in-person experiences.

Lessons From The Commoditization of Games

Gaming is the clearest real-world preview of a post-scarcity economy.

Over time, access to video games has largely become commoditized. This is a product of a multitude of factors, including democratized access to tools like game engines and AI coding, no-code and low-code solutions, simplified programming languages from large platform players like Roblox and Fortnite, the proliferation of free-to-play games, and the access via PCs, consoles, and cheap smartphones that enables the ~3.32bn players worldwide to enjoy games. In a lot of ways, the basic needs of gamers have been met and the way they behave could be indicative of the future of our economy:

1. Community: Gamers have gravitated towards games that have a community or social element that is core to the game experience.
2. Status: Gamers are purchasing skins and in-game cosmetics which provide a sense of individuality and can act as a status symbol if they were obtained through skill or time invested. In-game cosmetics or IAPs, has become an enormous revenue generator for these games.
3. Unique Experiences: Indie games are on the rise as they provide unique experiences, often to a niche audience, and can give the sense of “finding the diamond in the rough”.
4. Authenticity / Moral High Ground: As the basic needs of gamers are capable of being met by dozens of games, the community has largely rejected AI slop, and is demanding quality and authenticity. In a world where it is easy to play thousands of games, people still want the ones that feel like they have a human touch and are getting defensive for artists who are at risk of losing their jobs to AI.

Interestingly, the types of desires among gamers are very similar to those in Maslow's Hierarchy of Needs. Most games provide the basics to have a safe, fun experience, but once that is a commodity, people start to search for a place where they feel belonging (community), self esteem (skins), or even self-actualization (defense of human creators).

Another interesting pattern here is that value no longer accrues to the bottom of the pyramid (the pay-to-play model). The most lucrative components are at the top of the pyramid, with skins, which cater to self esteem, generating billions of dollars with in-game cosmetic sales.

Tying this back to envy and mimetic desire, the highest-value layers of the gaming ecosystem are the ones that are most visible, most comparable, and most capable of signaling status to others because those are the only ones where demand is insatiable.

What Industries Stand To Benefit?

As AI continues to commoditize products and reduce their costs, decreasing the price to meet our basic needs, humans will naturally gravitate to products that cater to the higher tiers of Maslow's hierarchy.

Industries with a human touch like nurses, therapists, and childcare workers could be more valuable. But industries with a human touch and an appeal to exclusivity and status are likely to capture an even larger portion due to their income elasticity.

• Tutors: There is an infinite amount of learning to be done and education has always been associated with status
• Trainers: While the amount of time allocated to working out may be finite, it could reasonably take up a larger portion of time. Health and wellness have also become a symbol of status
• Restaurants / Experiences: Spending on the best restaurants and experiences. Theoretically has no cap, and high-end hospitality is naturally exclusive  
• Luxury Goods: Something like a Swiss watch has always been a status symbol and could also benefit from this trend.

Services are traditionally not venture-backable, but tools to support these industries will become more valuable, especially those catering to the wealthiest customers.

Takeaway: As AI commoditizes many areas of production and lowers the cost of meeting basic needs, value shifts toward what remains scarce: human-driven, status-oriented, and experiential services. The same dynamics seen in gaming, where community and identity drive spending, will increasingly define the broader economy. The biggest opportunities will not be in the commoditized layers, but in enabling and scaling high-touch, income elastic goods and services that cater to status, exclusivity, and human connection.

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