Sound and Fury

Signifying nothing

Futarchy: nice idea. Until you think about it…

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Futarchy: vote values but bet beliefs. A new system of government that would fix all the problems with our current democracies. Or maybe not.

First, what is wrong with democracy? According to the above link, “Democracies fail largely by not aggregating available information.” And what is the best way to aggregate available information? “Betting markets are our best known institution for aggregating information.” It is based on the idea that things like the Hollywood Stock Exchange or Foresight Exchange are at least as good as an expert’s opinion. So we should use betting markets to assess the expected benefits of various policy decisions.

I think that both these claims are not unproblematic, but I am willing to grant them for now. Because futarchy has bigger problems than that. Let’s imagine that we have a futarchy government going on and imagine a scenario. The policy decision in question is whether or not to ban smoking in public places. The experts might say that this is a good idea for various reasons: cut down on passive smoking, perhaps encourage more people to quit thus decrease the burden on the health services and so on. But we don’t care about them. What does our betting market tell us? It will tell us, first, that there is no benefit at all. But on closer inspection it will tell us that the tobacco industry has a lot more money and a lot more vested interest in seeing this proposition fail than anyone else. Powerful industries with a lot of money and a lot invested in the outcome of a given policy decision will be able to manipulate the market to acheive the decision they want.

I haven’t read the PDF linked on that page but I intend to and then comment some more, in greater detail. But my first impression is that it’s a crazy idea. I do, however, like the idea of voting on values rather than on whatever area of policy happens to be contentious at the time of the election.

In a lighter note, well done Ronnie and Ali for two maximum breaks within a day or so of each other!


Written by Seamus

April 30, 2008 at 5:58 pm

Posted in random, snooker

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