Professor Horst Eidenmüller explores the future of AI in contract negotiation
Ahead of presenting at an international conference on AI and negotiation later this week, Professor Horst Eidenmüller has written for the Oxford Business Law Blog on AI's potential to transform how businesses negotiate and manage contracts.
Titled From Contract Embellisher to Negotiation Machine: The Use of AI in Contracting, Professor Eidenmüller's blog post argues that AI could be used to improve agreements that have already been signed – less risky and less complex than using AI to negotiate a contract in the first place.
With its origins in Howard Raiffa's idea of 'post-settlement settlements', Professor Eidenmüller's article posits AI as a neutral intermediary tasked with identifying mutually beneficial opportunities to enhance contracts that are unlikely to have provided maximum value or efficiency in their originally negotiated forms. For example, AI might discover that changing a delivery schedule would benefit a buyer without imposing significant costs on the supplier. Because the original agreement would remain in place unless both sides accepted the changes, this would be a relatively low-risk way to introduce AI into contracting. It could also be much cheaper and more practical than employing human mediators.
Looking further ahead, Professor Eidenmüller envisages AI moving beyond improving existing contracts to negotiating entirely new agreements – potentially even concluding deals automatically on behalf of the parties. This would, however, raise important questions about fairness and power. Professor Eidenmüller concludes that whether AI makes contracting fairer or simply strengthens the position of powerful businesses will depend heavily on competition between providers of AI negotiation tools and between the businesses using them.
Professor Eidenmüller will be speaking on Friday 30 October at Negotiation Transformed? AI in Bargaining and its Broader Implications, held at Columbia University in New York.