The math used for training AI—minimizing the gap between an internal model and external reality—also governs economics. Successful economic agents (individuals, companies, societies) are those with the most accurate internal maps of reality, allowing them to better predict outcomes and persist over time.

Static benchmarks are easily gamed. Dynamic environments like the game Diplomacy force models to negotiate, strategize, and even lie, offering a richer, more realistic evaluation of their capabilities beyond pure performance metrics like reasoning or coding.

A Rice PhD showed that training a vision model on a game like Snake, while prompting it to see the game as a math problem (a Cartesian grid), improved its math abilities more than training on math data directly. This highlights how abstract, game-based training can foster more generalizable reasoning.

Language is just one 'keyhole' into intelligence. True artificial general intelligence (AGI) requires 'world modeling'—a spatial intelligence that understands geometry, physics, and actions. This capability to represent and interact with the state of the world is the next critical phase of AI development beyond current language models.

With AI agents automating raw code generation, an engineer's role is evolving beyond pure implementation. To stay valuable, engineers must now cultivate a deep understanding of business context and product taste to know *what* to build and *why*, not just *how*.

Instead of asking an AI to directly build something, the more effective approach is to instruct it on *how* to solve the problem: gather references, identify best-in-class libraries, and create a framework before implementation. This means working one level of abstraction higher than the code itself.

Instead of replacing entire systems with AI "world models," a superior approach is a hybrid model. Classical code should handle deterministic logic (like game physics), while AI provides a "differentiable" emergent layer for aesthetics and creativity (like real-time texturing). This leverages the unique strengths of both computational paradigms.

Good Star Labs is not a consumer gaming company. Its business model focuses on B2B services for AI labs. They use games like Diplomacy to evaluate new models, generate unique training data to fix model weaknesses, and collect human feedback, creating a powerful improvement loop for AI companies.

As reinforcement learning (RL) techniques mature, the core challenge shifts from the algorithm to the problem definition. The competitive moat for AI companies will be their ability to create high-fidelity environments and benchmarks that accurately represent complex, real-world tasks, effectively teaching the AI what matters.