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AI public value creation: data encoding, aggregation, and algorithmic computation

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  • Cordella, Antonio
  • Gualdi, Francesco

Abstract

AI systems in public administration challenge the premise that value creation arises from managers' strategic mediation among the vertices of Moore's strategic triangle: Public value, legitimacy, and operational capacity. AI imposes new logics that reshape vertices and their interaction dynamics. Critically, these transformations become entrenched through what we term algorithmic public value lock-in: the crystallization of contingent value definitions into durable technical infrastructures resistant to democratic revision. Examining Peru's SISFOH, an algorithmic welfare-targeting system, we reveal three interconnected shifts: data management recasts legitimacy as computational objectivity; standardized classifications redefine public value in narrow, quantifiable terms; and algorithmic processing transforms operational capacity from adaptive discretion to rigid execution. Together,these shifts produce lock-in effects that potentially insulate public value creation from political negotiation.

Suggested Citation

  • Cordella, Antonio & Gualdi, Francesco, 2026. "AI public value creation: data encoding, aggregation, and algorithmic computation," LSE Research Online Documents on Economics 138826, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:138826
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    File URL: https://researchonline.lse.ac.uk/id/eprint/138826/
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    References listed on IDEAS

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    3. Sian Moore & Sonia McKay & Sarah Veale, 2013. "Locating the 2000 Statutory Recognition Procedure," Palgrave Macmillan Books, in: Statutory Regulation and Employment Relations, chapter 1, pages 9-41, Palgrave Macmillan.
    4. Sian Moore & Sonia McKay & Sarah Veale, 2013. "The Future for Statutory Recognition," Palgrave Macmillan Books, in: Statutory Regulation and Employment Relations, pages 239-245, Palgrave Macmillan.
    5. Karen Yeung, 2018. "Algorithmic regulation: A critical interrogation," Regulation & Governance, John Wiley & Sons, vol. 12(4), pages 505-523, December.
    Full references (including those not matched with items on IDEAS)

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    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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