Follow-up to: Moloch's Toolbox (1/2)

vii. Sticky traditions in belief-dependent Nash equilibria without common knowledge

cecie: I could talk next about a tax system that makes it cheaper for corporations to pay for care instead of patients, and how that sets up a host of “decisionmaker is not the beneficiary” problems.

But I suspect a lot of people reading this conversation understand that part already, so instead I’ll turn my attention to venture capital.

visitor: It sounds like the “politicians” and the “voters” might be a more key issue, if the cultural translator is right about what those correspond to.

cecie: Ah! But it turns out that venture capitalists and startups can be seen as a simpler version of voters and politicians, so it’s better to consider entrepreneurs first.

Besides, at this point I imagine the Visitor is wondering, “Why can’t anyone make any money by saving those babies? Doesn’t your society have a profit incentive that fixes this?”

visitor: Actually, I don’t think that was high on my list of questions. It’s understood among my people that not every problem is one you can make a profit by fixing—persistent societal problems tend to be ones that don’t have easily capturable profits corresponding to their solution.

I mean, yes, if this was all happening on our world and it wasn’t already being addressed by the Serious People, then somebody would just mix the bleeping nutrients and sell it to the bleeping parents for bleeping money. But at this point I’ve already guessed that’s going to be illegal, or saving babies using money is going to be associated with the wrong Tower and therefore unprestigious, or your parents are using a particular kind of statistical analysis that requires baby sacrifices, or whatever.

cecie: Hey, details matter!

visitor: (in sad reflection) Do they? Do they really? Isn’t there some point where you just admit you can’t stop killing babies and it doesn’t really matter why?

cecie: No. You can never say that if you want to go on being a cynical economist.

Now, there are several different kinds of molasses covering the world of startups and venture capital. It’s the tradition-bound aspects of that e...

Inadequate Equilibria