The Big Point About The Prisoners Dilemma

[Borodog]

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Even if those dubious comments were true, all you would be showing is that I didn't pick a good example of the point.

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The point is that it's impossible to pick a good example of the point if one's analysis is deep enough.

[luckyme]

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The point is that it's impossible to pick a good example of the point if one's analysis is deep enough.

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I think the last 20 threads about dwarf burmese thieves have illustrated that quite well.

luckyme

[cookmg]

My understanding of PD problems is that in any attempt to cooperate each individual has an incentive to cheat on the agreement. If your fellow cooperatives don't cheat you get a big payoff by cheating and if they all cheat you're way behind if you don't cheat as well. Regardless of what they do, your best play is to cheat -- so you cheat. And so will they: Since everyone else has the same incentive structure the result will be everyone cheats and your payoff is worse than if you had all just cooperated. Optimally, you'd want everyone else to cooperate and you alone cheat, but as long as cheating is incentivized for others you'll be way behind if you don't so you'd all do better to just have everyone forced to cooperate. You don't necessarily need coercion in the traditional sense for this to work, but you do need something that removes the incentive for anyone to cheat. Religion might be an example of a big brother that makes people consider others in their incentive structure.

[FortunaMaximus]

Religion's too broad an example. It doesn't determine the situation of religion v. religion in a Terran context whereas Big Brother as a single entity is concerned.

Dwarf Burmese thieves, huh.

[chezlaw]

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My understanding of PD problems is that in any attempt to cooperate each individual has an incentive to cheat on the agreement. If your fellow cooperatives don't cheat you get a big payoff by cheating and if they all cheat you're way behind if you don't cheat as well. Regardless of what they do, your best play is to cheat -- so you cheat. And so will they: Since everyone else has the same incentive structure the result will be everyone cheats and your payoff is worse than if you had all just cooperated. Optimally, you'd want everyone else to cooperate and you alone cheat, but as long as cheating is incentivized for others you'll be way behind if you don't so you'd all do better to just have everyone forced to cooperate. You don't necessarily need coercion in the traditional sense for this to work, but you do need something that removes the incentive for anyone to cheat. Religion might be an example of a big brother that makes people consider others in their incentive structure.

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But they also have a reason not to cheat which is they everyone benefit most from a trust based cooperations.

Religon is exactly the same idea (sometimes called the noble idea) as it fullfills the role of a big bother without the big brother needing to exist but it is rational to form a trust based relationship it is not rational to believe in god.

chez

[GMontag]

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Total nonsense. Every positive externality is a PD type problem. They very much occur even in the presence of private property. They do often generate their own solutions, but usually that solution *is* centralized violence.


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Example please if you dont mind.

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Normally I don't have to read this kook's posts, since I have him on ignore, but since you've quoted him, I suppose I have to respond.

"Positive" externality? I'm sure you mean negative externality? The fact that my neighbor benefits from me mowing my lawn surely doesn't lead to a Prisoners' Dilemma, I trust?

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I meant exactly what I said. A positive externality is one where the benefits spill over, and therefore the market reflects a reduced demand relative to the real demand. Mowing your lawn isn't an externality because the fact that your lawn is mowed doesn't discourage others from mowing their lawn.

Something like police or fire service on the other hand does. If you live in an AC neighborhood and half of the people have paid for police patrols, that will stop burglars from coming around the entire neighborhood, and the rest of the residents are therefore discouraged from paying for the service. I've explained this all before, but in typical fashion, you and Riddick dissmissed it with nonsensical strawman "counter-examples" ala the deodorant.

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In the future you may cease responding to my economics posts. You're on ignore

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I'm well aware. However, my posts are not meant solely for you. Others are welcome to respond to them.

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, Mr. You Can't Make Money Pumping Oil Out Of The Ground Because You Need Oil To Do It.

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Lol. If you want to try to explain how *rising* oil prices can magically turn a net energy loss situation to a net energy gain, be my guest. BTW, I'm still waiting for an explanation of your assertion that somehow fractional reserve banking creates money while simple lending and borrowing does not, when in fact all FRB *is* is simple lending and borrowing.

[BCPVP]

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If you live in an AC neighborhood and half of the people have paid for police patrols, that will stop burglars from coming around the entire neighborhood, and the rest of the residents are therefore discouraged from paying for the service.

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Why would they pay to protect your house? I think a more likely idea is that the neighborhood road owner would purchase the fire/police services and those costs would be reflected in the road price. Therefore this externality problem has been solved.

[Borodog]

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If you live in an AC neighborhood and half of the people have paid for police patrols, that will stop burglars from coming around the entire neighborhood, and the rest of the residents are therefore discouraged from paying for the service.

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Why would they pay to protect your house? I think a more likely idea is that the neighborhood road owner would purchase the fire/police services and those costs would be reflected in the road price. Therefore this externality problem has been solved.

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I love how people invent an arbitrary scenario that contains externalities, and hence won't work, as some sort of argument against the market, when all they're really saying is that the market won't use their stupid externality-ridden idea.

[GMontag]

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If you live in an AC neighborhood and half of the people have paid for police patrols, that will stop burglars from coming around the entire neighborhood, and the rest of the residents are therefore discouraged from paying for the service.

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Why would they pay to protect your house?

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They wouldn't, and if a burglar actually broke into the house of a non-paying resident, the police wouldn't come. But the mere fact there are houses that subscribe to the police service in the area means that the burglars are less likely to be coming around in the first place.

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I think a more likely idea is that the neighborhood road owner would purchase the fire/police services and those costs would be reflected in the road price. Therefore this externality problem has been solved.

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Solved by instituting a local monopoly. How is this different than a state taxing and providing the services?

[BCPVP]

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They wouldn't, and if a burglar actually broke into the house of a non-paying resident, the police wouldn't come. But the mere fact there are houses that subscribe to the police service in the area means that the burglars are less likely to be coming around in the first place.

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Ok....?

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Solved by instituting a local monopoly. How is this different than a state taxing and providing the services?

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1) It's not a monopoly.
2) Road owners have a large incentive to provide good service at low cost while the gov't has no such incentive.