A/C in Action: The AP Case

[Phil153]

[ QUOTE ]
Note that Consumer Reports is non-profit, highly reliable, widely regarded as trustworthy, and in fact is calling out companies that the government already is not calling out.

[/ QUOTE ]
And they do a great job. ISO is another great example of an organization that voluntarily builds quality and safety standards.

But Consumer Reports has no power - the have the same problem that we do with the AP scandal. They rely on consumers actually reading and understanding their content, which is a small percentage of users. And then these consumers have to vote with their dollars, which many won't out of laziness, indifference, not knowing the source of a product, or being poor and having few choices. Most people are in favor of saving the environment, but they happily buy paper from clearfelled forests because they simply don't know without a lot of time consuming research.

And given the fact that manufacturers can hide the chain of ownership (and 10x more in the absence of regulations), and that retail chains have an interest in buying cheap products and hiding controversial sources, I don't hold out much hope for people being held accountable.

[tomdemaine]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
The claim of ACists is that the market maximizes value, not just provides some value.

[/ QUOTE ]

Not of THIS ACist.

Value is subjective.

[/ QUOTE ]

Nor this one.

[/ QUOTE ]
So excluding the morality of government, do you both renounce all claims that the market will do a better job than the government in important areas?

[/ QUOTE ]

Better for who? How do you quantify better? To answer your question the morality of government is the fundamental issues for me the ancillary benefits of a free society (of which I believe there would be very many) are just that, ancillary.

[Money2Burn]

[ QUOTE ]
[ QUOTE ]
To all who say this is a failure of the market to selfregulate,

If there had been heavy regulation in this industry by our government or any other government, for that matter, how long would it take in your estimation for this whole matter to be resolved and "adaquate" punishment delt to Absolute?

[/ QUOTE ]
Well, their license would be revoked for one, which means they couldn't operate under pain of jail time.

To be honest I can't imagine a scandal like this even happening under modern gaming regulations, such as those in the UK. There's too much to lose and too much oversight. Even if it did, the site would be shut down and/or forcibly have a transfer of ownership.

[/ QUOTE ]

The license wouldn't be revoked right off the bat, there would have to be an investigation done, subpeonas issued, depositions listened to, audits performed. These things take substantial amounts of time.

[ianlippert]

[ QUOTE ]
The claim of ACists is that the market maximizes value, not just provides some value.



[/ QUOTE ]

Markets maximize utility which is based on subjective consumer preferences. If the market hasnt responded to AP its because people dont care. If people start to care more the market will adjust. The market isnt some invisible hand (worst analogy ever) its the needs and desires of that consumers reveal through the actions that they take.

[ QUOTE ]
Then why do you make the claim that its irrational and retarded? It is no more irrational or retarded than renting a DVD.


[/ QUOTE ]

Ultimately every consumer action is rational because people are just acting on their desires. Theres nothing irrational about gambling if we understand that it fills a desire of the consumer. I was saying that it is irrational from a monetary point of view. People believe that they can beat the odds, which is simply false.

[ QUOTE ]
ANY exra cost that consumers in general are unaware of but is known to a segment of the market is a market failure that ACist claim would be corrected for. That self regulating mechanism is fundamental to the success of AC.


[/ QUOTE ]

Lack of information is not a market failure because information is a commodity that has value just like anything else. Those players that lack the information pay for it. There is no magical way for everyone to know everything so by your terms everything is a market failure.

[ QUOTE ]
The "high risk tolerance market" is of above average intelligence and above average in computer usage and therefore access to information. Your claim that they are "irrational" is unfounded. Extrapolation of this above average group to markets as whole is valid.

[/ QUOTE ]

Since the majority of players are losing players yet they continue to play they are monetarily speaking irrational. If they enjoy gambling and expect to lose then a small increase in their losses isnt a significant market failure.

[ QUOTE ]
You are guilty of what other ACists posting here are guilty of...trying to explain away clear examples of where their basic tenets fail as irrelevant, when in fact they are quite relevant. And you wonder why thinking people dismiss AC as untenable in the real world.


[/ QUOTE ]

You problem is that you think ACists are efficiency nits. We arent, there are going to be people who dont have information. We simply dont see this as a problem. Statists have this problem where they see any small issue as a reason to bring in regulation and legislation instead of letting market actors decide by their own actions how much inefficient costs they are willing to bear.

[pvn]

[ QUOTE ]
[ QUOTE ]
The market has provided that information to consumers they just aren't interested in finding it or acting on it when they do! They may say that their interested but this little situation proves conclusivly that they're not.

[/ QUOTE ]
That's part of the crux of this issue. Consumers may want this information, but not have the awareness, skill, expertise or time to determine it.

If I had to research every product before I bought it, efficiency would grind to a halt. I'd much rather a regulatory agency I know I can trust test for excess pesticides or lead on toys, so I know I don't even need to investigate items that I find on shelves, the credentials of the manufacturer, the credentials of the store, the credentials of the private regulatory body whose interest is profit.

This idea (transaction costs costs caused by AC vs efficiency generated by absolute power and implicit regulation) is a huge argument for government.

[/ QUOTE ]

This "huge argument for government" would be a little more compelling if it actually did keep lead-paint-covered toys off of shelves. But it doesn't.

Now, even if it did, you're going to sit there and tell me that I need to pay for the same inspection agency YOU like? And how is this angle going to justify the six xillion other "helpful" functions of government?

[tomdemaine]

[ QUOTE ]
[ QUOTE ]
Note that Consumer Reports is non-profit, highly reliable, widely regarded as trustworthy, and in fact is calling out companies that the government already is not calling out.

[/ QUOTE ]
And they do a great job. ISO is another great example of an organization that voluntarily builds quality and safety standards.

But Consumer Reports has no power - the have the same problem that we do with the AP scandal. They rely on consumers actually reading and understanding their content, which is a small percentage of users. And then these consumers have to vote with their dollars, which many won't out of laziness, indifference, not knowing the source of a product, or being poor and having few choices. Most people are in favor of saving the environment, but they happily buy paper from clearfelled forests because they simply don't know without a lot of time consuming research.

[/ QUOTE ]

Then they're not in favour of saving the environment. Saying "i favour saving the environment" doesn't mean you favour saving the environment. It means you're a liar for most people. Actually taking actions which have a cost associated with them is how you show that you want to save the environment.

[ QUOTE ]

And given the fact that manufacturers can hide the chain of ownership (and 10x more in the absence of regulations), and that retail chains have an interest in buying cheap products and hiding controversial sources, I don't hold out much hope for people being held accountable.

[/ QUOTE ]

But you feel that it'll be a doddle to hold government officials accountable for their actions? Black is white today.

[Luxoris]

[ QUOTE ]
In a free market would the sites not be allowed to advertise their services?

[/ QUOTE ]

they can advertise their better security now if they choose to. There is nothing to stop them in Europe or here

[ QUOTE ]
Think the AP scandal would have more of a market effect if they could run ads touting their security over other sites?

In a free market would I not be allowed to put my money where I see fit with minimal trouble?

[/ QUOTE ]

Yes but that irrelevant here. You CAN get your money in, they CAN inform you of AP's problem.

[ QUOTE ]
In a free market would certain sites not do business in the US for fear of legal repercussions?

[/ QUOTE ]

again irrelevant to the core issue






The online poker landscape is far from a free market.

[/ QUOTE ]

[ianlippert]

[ QUOTE ]
You are (apparently intentionally) missing the point. Even in your proposition that an AC world within a statist world would be more prosperous than the alternative, the European market has failed to provide essential information. Avoid the issue as much as you want, but if you can't even attempt to explain why this isn't a failure even in its limited scope without a claim that this particular market is more irrational than any other market, this thread is over for me, and you're relegated to the Borodog world of intellecutal dishonesty.

[/ QUOTE ]

If your definition of market failure is that people dont have information then every market is to some degree a market failure. But why call it market failure, nobody has ever claimed that the role of the market is to inform everybody on the consequences of their decisions. This strawman of markets is created so that when it doesnt work out 100% in the real world (as would be predicted) they have an excuse to regulate and control the market.

[Phil153]

[ QUOTE ]
[ QUOTE ]

So excluding the morality of government, do you both renounce all claims that the market will do a better job than the government in important areas?

[/ QUOTE ]

Better according to whose subjective personal preferences? I can think of a lot of people who think it will be significantly worse.

[/ QUOTE ]
You guys are making it out like there are just personal subjective preferences, and who am I to tell you what to want? It's almost economic solipsism.

There aren't just subjective preferences. For example, I think the following metrics of a society have an objective basis and significant merit, even if their relative importance may vary:

- Personal safety
- Certainty and stability
- Protection from external threats
- Efficiency
- Economic strength and innovation
- Environmental impact (i.e. destructive or polluting activities)
- Accountability (tied in with notions of justice)
- Availability of the arts and cultural items
- Literacy
- Personal freedom
- Rate of fraud

To name a few. These have an objective basis as being valuable parts of civilization, and they're what my question is based on.

[Luxoris]

[ QUOTE ]
[ QUOTE ]
You are (apparently intentionally) missing the point. Even in your proposition that an AC world within a statist world would be more prosperous than the alternative, the European market has failed to provide essential information. Avoid the issue as much as you want, but if you can't even attempt to explain why this isn't a failure even in its limited scope without a claim that this particular market is more irrational than any other market, this thread is over for me, and you're relegated to the Borodog world of intellecutal dishonesty.

[/ QUOTE ]

If your definition of market failure is that people dont have information then every market is to some degree a market failure. But why call it market failure, nobody has ever claimed that the role of the market is to inform everybody on the consequences of their decisions. This strawman of markets is created so that when it doesnt work out 100% in the real world (as would be predicted) they have an excuse to regulate and control the market.

[/ QUOTE ]

The AC claim is that regulation isnt necessary because markets will self regulate...insurance companies that deny claims will be abandoned, DROs that cater to deep pockets will be exposed etc.

Essential to that process is that information itself is "efficient".

It isnt.

It is absolutely clear that AP would have considered its actions more throughly if regulated within their market, and is very likely to have not cheated in the first place.