tag:blogger.com,1999:blog-2830084253401570472.post3744501261095923127..comments2024-03-28T09:22:36.967+13:00Comments on Offsetting Behaviour: Futarchy and its discontentsEric Cramptonhttp://www.blogger.com/profile/15831696523324469713noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-2830084253401570472.post-86997187383835250512010-01-07T08:45:02.893+13:002010-01-07T08:45:02.893+13:00@TorontoPM: I'm about to be without internet ...@TorontoPM: I'm about to be without internet access for a couple days, so apologies if I don't get back to you quickly. But I'd make a few points:<br />1. When was the last time there was a revolution in any country that might plausibly start moving towards futarchy?<br />2. I'm more worried about the weights being influenced too strongly by expressive voting and being fixed than I am that they're not entirely transparent to most voters: all we need is that the marginal trader gets it.<br />3. I'll take the point on hard-wiring, but only because I don't think that we can get the hard wired numbers right to start with.<br />4. I've seen your critiques on manipulation, but am still rather of the view that with markets where traders aren't bounded by liquidity constraints, manipulation won't be a big issue (or at least no bigger an issue than similar problems under democracy)<br />5. Again, the markets may well have high variance over long time periods. But so long as they get the difference across markets right, it's all good. So long as most of the uncertainty washes out in the fixed effects, all's great! And even if not, we still don't need to achieve perfection, just beat the status quo.Eric Cramptonhttps://www.blogger.com/profile/15831696523324469713noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-16801163229611791122010-01-07T05:11:20.794+13:002010-01-07T05:11:20.794+13:00You make a good point that the cost of policy prop...You make a good point that the cost of policy proposals may not be much different from that in existing political systems. However, in many existing systems, when the stench of bad proposals gets high enough, the citizens will protest (even Canadians!), revolt or perhaps vote. The "costs" are not quite the same. Under futarchy, the citizens have to write a cheque. Today, they can spend their time and effort to make their policy preferences known.<br /><br />You seem to think that just because the GDP+ definition is known, it is "completely transparent". I'm afraid I have to disagree. My point is that as the definition becomes more complex (as described by Robin Hanson), it becomes less "transparent". Few, if any, will know how it "works" or what it "means". In this sense, revealing the calculation doesn't mean "transparency".<br /><br />The problem with GDP+ is that it is far too simplistic, even in its most complex form. It hard-wires relationships among, and tradeoffs between, values. Not only does it specify these for the present day, but it requires that the relationships and tradeoffs not change for a very long period of time. Further, the same relationships and tradeoffs are deemed to apply to all policy proposals presently being considered. It is a gross simplification of decision-making, which has little chance for success.<br /><br />You commented that Robin's paper adequately addresses the manipulation issue. It does not. It merely assumes the problem away. My post on futarchy contains a number of links to other posts that show this clearly.<br /><br />As for long-term prediction markets, there is no proof, whatsoever, that they are accurate or "calibrated". They may be calibrated, but even if they are, they display a very high level of uncertainty about the outcome, making them useless for decision-making. The markets are merely telling us that we need more (a lot more) information.<br /><br />I'm afraid that StompinRhino would be very disappointed with futarchy, because prediction markets have nothing to do with a "balanced" range of citizens and interests. These markets do seek diversity, but the "informed" feast on the chimps in order to make the markets work.<br /><br />I'm sure I could like futarchy "so much" too, if it worked "as advertised". While the benefits of such an institution might be extremely significant, applying a cost-benefit analysis to the further investigation of futarchy, we would find the costs far outweigh the expected benefits (i.e. very high potential benefit times an extremely low likelihood = very small expected benefit).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-83382772063093161702010-01-06T23:03:17.779+13:002010-01-06T23:03:17.779+13:00@Stompin: Check Hanson's paper; I'm pretty...@Stompin: Check Hanson's paper; I'm pretty sure that's one of his raised (and answered) objections. So long as GDP+ is sound and there are liquid traders who care about profiting on their trades, then it doesn't much matter whether traders aren't like other folks. We only need the marginal traders to be sensible.Eric Cramptonhttps://www.blogger.com/profile/15831696523324469713noreply@blogger.comtag:blogger.com,1999:blog-2830084253401570472.post-40702497892745378942010-01-06T17:01:52.348+13:002010-01-06T17:01:52.348+13:00Very interesting idea. One potential issue might b...Very interesting idea. One potential issue might be the difficulty making sure that you have a broad/balanced range of citizens & interests represented, otherwise both the policy setting and the pricing may be skewed towards the objectives of specific groups.StompinRhinohttps://www.blogger.com/profile/16405293530770922619noreply@blogger.com