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Prizes, Shared Hazard, and the Speed of Frontier AI

Li Gan

Abstract: Frontier AI labs compete in a contest for commercial leadership while sharing the risk of catastrophe. Each lab gains from arriving earlier but bears only part of the hazard its speed adds, which this paper calls the hazard externality. In an illustrative calibrated takeoff model, three racing labs get through the takeoff period in 18 months, while a common rule on research shares would stretch it to 69 months. Neither force alone explains racing that fast. Removing the contest first closes over ninety percent of the gap in catastrophe probability between racing and a common rule when the catastrophe probability at full speed is 75 percent, and 69 percent when it is 25 percent; averaged over both orders of removal, the contest explains 65 and 44 percent. More labs make each lab race harder, when industry hazard at a common research share does not depend on the number of labs. Under open source in its ideal form, where every lab publishes its capability findings at once, labs slow to the coordinated pace, because no lab can get ahead and each bears all the hazard its research adds. One lab's restraint achieves much less than a common rule. The White House Accord on Super Intelligence of September 2026 audits safety but sets no limit on speed. In the model it does not slow the race, because each lab still gains as much from speeding up.

Submitted to arXiv on 03 Nov. 2026