W7117476267 Working papers AI × management and organizations

The Human-AI Contracting Paradox

Hamsa Bastani · Gerard P Cachon

Also recorded as: doi:10.2139/ssrn.5962739 · ssrn:5962739

ssrn abstract page · 2025-12-29

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Recorded claims

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A principal-agent model yields a contracting paradox in which increasingly reliable but unpredictably fallible AI makes it more expensive to motivate human vigilance, with the required wage scaling inversely with AI error probability and potentially inducing firms to limit collaboration or prefer a less reliable tool.

confidence: high ssrn-abstract-page apw-e1-ssrn-backfill

Scope: Theoretical principal-agent model of professional human-AI workflows; no empirical population, sample, observation period, or statistical denominator

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  • The result is model-based and the abstract does not report its assumptions, robustness conditions, or empirical validation.
  • The page states it was revised on 2026-04-06; only the public abstract manifestation observed on 2026-08-20 was inspected.

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