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AI, Marketplaces and Labor Markets

What are the implications of the prevalence and importance of online marketplaces and computer-mediated transactions? How can they be designed to create widespread benefits for all? The IDE works to understand the rise of online marketplaces and to guide entrepreneurs and existing companies to successful platform strategies and best practices. We also conduct research using these markets, both to inform practice and to understand what these new markets can teach us about old questions. Some of the more interesting markets have a substantial labor component, raising compelling questions about practice, strategy and public policy. John Horton leads this Research Group.

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Working Papers General Social Agents

Jun 2026

John Horton | Associate Professor, MIT Sloan School of Management

Benjamin Manning | Ph.D. Candidate

Useful social science theories predict behavior across settings. However, applying a theory to make predictions in new settings is challenging: rarely can it be done without ad hoc modifications to account for setting-specific factors. We argue that AI agents put in simulations of those novel settings offer an alternative for applying theory, requiring minimal or no modifications.

Working Papers Chaining Tasks, Redefining Work: A Theory of AI Automation

Jan 2026

John Horton | Associate Professor, MIT Sloan School of Management

Peyman Shahidi | Ph.D. Candidate

Brendan Lucier | Microsoft Research

Nicole Immorlica | Yale University, Microsoft Research

Mert Demirer | MIT

 

This paper develops a model that predicts that (1) AI-executed steps co-occur in chains, (2) dispersion of AI-exposed steps lowers AI execution at the job level, and (3) adjacency to AI-executed steps increases the likelihood that a step is AI-executed.