Tagged: Game theory

Quotes

Even presupposing extraordinary cognitive capacities and levels of patience among the cooperating individuals, there is no reason to believe that a group of more than two individuals would ever discover the cooperative Nash equilibria that the [Folk Theorem] models have identified, and if it were to hit on one, its members would almost certainly abandon it in short order.#

What's Holding Back Blockchain Finance? On the Possibility of Decentralized Autonomous Finance
Despite the past decade’s rapid innovation in adapting blockchain technology to new uses, financial intermediation remains elusive except in basic and highly collateralized forms. We introduce the concept of the technical frontier to delimit the kinds of interactions that can feasibly be structured algorithmically among pseudonymous agents, as on a . . .
The Feudal Origins of the Western Legal Tradition
This paper draws a distinction between ‘communitarian’ and ‘rationalist’ legal orders on the basis of the implied political strategy. We argue that the West’s solution to the paradox of governance – that a government strong enough to protect rights cannot itself be restrained from violating those rights – originates in . . .
Inside and Outside Perspectives on Legitimacy: An Economic Theory of the Noble Lie
Drawing on the theory of cooperation, this paper argues that the impossibility of constructing totally incentive-compatible institutions, whether organizationally or politically, entails a necessary divergence between subjective preferences and objective payoffs – a “noble lie”. This implies the existence of irreducible and irreconcilable “inside” and “outside” perspectives on social institutions; . . .