Saturday, December 29, 2007

Foresight Exchange

I opened a Foresight Exchange account today (rolf.h.d.nelson). The main purpose is to challenge myself to become a better thinker by forcing myself to think through both the sides of why future events may or may not happen. My initial plan was to buy or sell one share in each of the "U.S. News" categories. I got through about six of the items before I gave into the temptation to put all the rest of my money down on "No" for the mispriced USAGeo.

The presence of mispriced items in this play-money exchange didn't surprise me, especially for "X will happen by the year Y." Presumably people put down "Buy if it goes down to price Z" orders, and as year Y comes closer and the price drops naturally well past Z, they have little incentive to log back in and rescind their now-insane orders (especially if they've abandoned their accounts.)

What did surprise me was how *boring* the brief experience was. Most of the decisions revolved, not around profound questions of philosophy or ideology, but around peering at graphs and trying to extrapolate probabilities of non-controversial events. The poor user interface added to the boredom factor as well.

Sunday, December 9, 2007

Am I corruptible?

Lord Acton said that "power corrupts." Others say that corrupt people in power were already corruptible to begin with; we just don't notice that people are prone to corruption before they gain power, because they never had the opportunity to benefit from corruption.

As a thought experiment, let's use the following model. 80% of the people are corruptible: that is, they will act corrupt if they become the King; there is no way of determining whether someone is corrupt before they become the King. Everyone publicly denies that they are corruptible. Two worlds exist, identical in every respect except:

In the "Self-Deceptive World", everyone has a self-image of themselves as incorruptible before they gain power.

In the "Self-Aware World", everyone is fully aware of whether they are corruptible; the corruptible people merely lie and claim that they are incorruptible.

These are the only two worlds that exist; to put it another way, the a priori odds that you live in one world rather than the other is 50%.

You have the self-image of yourself as someone who is incorruptible, but you have never been the King, and are unsure of which of the two worlds you live in. In this case, I would reason as follows:

Pick ten people at random, maybe five will be from the Self-Deceptive World, and five will be from the Self-Aware World. On average, there will be five self-deceptive people from the Self-Deceptive World with an incorruptible self-image, and one self-aware person from the Self-Aware World with an incorruptible self-image. Therefore, the odds are 5:1 that you live in the Self-Deceptive World, and are corruptible.