Self interest could take many forms, some of which don’t look like traditional greed at all.

Say, for instance, you run a play market and people play it because it’s fun. Is the self-interest of enjoying playing a fun game greed? Not really, and it’s probably more gentle to the real economy.

Or say that the US Government produces a market and says “the people with the best track record will be awarded medals for their service to the nation” (or be allowed to meet the president, or somesuch). Furthermore assume these medals aren’t of all that high value monetarily speaking. Then the market will select for those who find being rewarded for service by the US Government, well, rewarding. As long as there are enough of them that at least somebody in the pool is good at predicting, the market will work.

The predictors might desire a medal to signal their faithful nature to the US, or they might do it because it’s tangible evidence that they’re helping their nation and such gives them more of a “glow”. The play market doesn’t care in any case.

You could obviously say that all of this is self-interest, but if you go by that definition, pretty much everything is done in self interest. Even the aforementioned warm glow of “America is awesome” is then desired from self interest, because warm glows feel good.

Maybe, for more complex prediction, play markets that are simply fun will turn out better anyway, for the same reason extrinsic motivation can hurt performance in creative jobs. But again, if what I’ve said is true, then the market will adapt to it by attenuating the players whose performance is degraded by that effect.

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In any case, they want something other then the warm glow of signaling that America will definitely win the next war because America is awesome, go America.

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Prediction markets are promising because they use greed to fix epistemology. Neocameralism is promising because it uses greed to fix governance. And social impact bonds are promising because they use greed to fix social problems.

I don’t think prediction markets use greed per se to fix epistemology. Just consider a prediction market that is set up like a game, where you can’t buy any real life goods with the money you earn, but you can still reinvest it in other predictions. Then there’s no real world greed in it (because the play money doesn’t let you command others’ work), but it will still work due to basic feedback. That is, the players who do well get more play money and so can invest more, while those who do badly get less and their signals are attenuated out of existence.

From that perspective, greed (in the sense of playing the game for the power it grants you) only matters inasfar as it attracts people who are very good at predicting.

Quoting Wikipedia:

A common belief among economists and the financial community in general is that prediction markets based on play money cannot possibly generate credible predictions. However, the data collected so far disagrees.

so that supports the concept that it’s not the greed (as such) that makes markets good, but the feedback that properly filters claims. The motivations of the players don’t matter as long as the players themselves are good enough.

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On the other hand, if they’re conscious and refusing treatment despite having a hole through their chest, the right thing to do is let them die.

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If someone is brought into an .ER in coma and patched up,
Did they have something to them without their consent?

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Well if you offered them a job in a bank instead then they would get more money and you may avoid the next financial crisis… oh and of course put the bankers in jail for symmetry if no other reason. It may make the prison guards job much easier.

Seriously though I cant think of an easy way to keep people out of jail involving money without giving them a perverse incentive to get into the scheme by committing crime.

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In general you should be more willing to pay for outcomes when you know exactly what you want, but have no idea how to get it. In social policy, though, specifying outcomes non-perversely can be hard.

Exactly. We could make a little more headway here if our legal system weren’t so, um, legalistic about contracts. But for now, anything contracted out like this is much more likely to deliver the letter, rather than the spirit, of the specified goals.

Relatedly, Robin Hanson’s second premise on futarchy says

It is not that hard to tell rich happy nations from poor miserable ones.

Which is crazy talk. Specifying happiness is ridiculously hard.

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The Texan homicide rate is 4 times the English one. Not slight.

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