The Collapse of Supervision - V1.0

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Authors: Eunice Xiang Zi Wong
Cited by: 0

Abstract

This paper develops a dynamic theory of human–AI supervision in high-reliability systems. Building on the human–AI contracting framework of Bastani and Cachon (2025), it introduces time and attention as endogenous state variables governing the feasibility of oversight. The core result is that supervision collapses dynamically even under incentive-compatible contracts. As AI systems become increasingly reliable, failures occur too infrequently to replenish human attention, causing the effective cost of inspection to grow endogenously over time. Monitoring therefore persists in form but not in substance. The analysis further shows that holding mean reliability constant, clustered failures can sustain supervision by restoring informational salience. This result reframes the apparent preference for imperfect systems as a temporal coordination mechanism rather than a behavioral anomaly. More broadly, the paper characterizes institutional failure as a temporal mismatch between continuous machine operation, linear institutional time, and rhythmic human cognition. The findings have implications for AI governance, organizational design, and contract theory, suggesting that effective oversight requires temporal structuring rather than stronger incentives alone.

Fields of Study & Subjects

Ethics and Social Impacts of AI Human-Automation Interaction and Safety Occupational Health and Safety Research

Publication details

Journal / source
Zenodo (CERN European Organization for Nuclear Research)
Publication date
8 January 2026
Language
EN