{"ID":2880757,"CreatedAt":"2026-06-01T04:54:23.091178241Z","UpdatedAt":"2026-06-01T04:54:23.091178241Z","DeletedAt":null,"paper_url":"https://arxiv.org/abs/2508.13942","arxiv_id":"2508.13942","title":"The Collaboration Paradox: Why Generative AI Requires Both Strategic Intelligence and Operational Stability in Supply Chain Management","abstract":"The rise of autonomous, AI-driven agents in economic settings raises critical questions about their emergent strategic behavior. This paper investigates these dynamics in the cooperative context of a multi-echelon supply chain, a system famously prone to instabilities like the bullwhip effect. We conduct computational experiments with generative AI agents, powered by Large Language Models (LLMs), within a controlled supply chain simulation designed to isolate their behavioral tendencies. Our central finding is the \"collaboration paradox\": a novel, catastrophic failure mode where theoretically superior collaborative AI agents, designed with Vendor-Managed Inventory (VMI) principles, perform even worse than non-AI baselines. We demonstrate that this paradox arises from an operational flaw where agents hoard inventory, starving the system. We then show that resilience is only achieved through a synthesis of two distinct layers: high-level, AI-driven proactive policy-setting to establish robust operational targets, and a low-level, collaborative execution protocol with proactive downstream replenishment to maintain stability. Our final framework, which implements this synthesis, can autonomously generate, evaluate, and quantify a portfolio of viable strategic choices. The work provides a crucial insight into the emergent behaviors of collaborative AI agents and offers a blueprint for designing stable, effective AI-driven systems for business analytics.","short_abstract":"The rise of autonomous, AI-driven agents in economic settings raises critical questions about their emergent strategic behavior. This paper investigates these dynamics in the cooperative context of a multi-echelon supply chain, a system famously prone to instabilities like the bullwhip effect. We conduct computational...","url_abs":"https://arxiv.org/abs/2508.13942","url_pdf":"https://arxiv.org/pdf/2508.13942v2","authors":"[\"Soumyadeep Dhar\"]","published":"2025-08-19T15:31:23Z","proceeding":"cs.AI","tasks":"[\"cs.AI\"]","methods":"[\"Large Language Model\",\"Language Model\"]","has_code":false}