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We haven't seen the worst of what gambling and prediction markets will do

derekthompson.org

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Re: We haven't seen the worst of what gambling and prediction markets will do

#661

Post by Breza »

kjkjadksj wrote: post #622
superxpro12 wrote: post #619

The final conclusion about the evolving and rising focus on "money" as a core value is interesting, and one that seems to make sense to me. I think most people before the age of information found meaning in life in these non-monetary "beliefs"... religion, community engagement, etc. Mostly to the benefit of the wealthy class. I think people are finally waking up to the fact that the wealthy (parasite) class have been…

Yeah everyone likes to throw a stupid little comment at Robinhood but come on. My parents did not invest outside their 401k. My grandparents actually stuffed 20k in their mattress, must have been pretty good money when they put it under there. We are approaching the first couple years of this country where investing knowledge has actually proliferated out of the country club. It is a huge shift in the tide but no one…

The rise of low/no fee brokers is a fantastic advancement for the reasons you cite. Robinhood gets grief because it tries to drive people to trade often and take riskier bets when the long-known wisdom is that accumulating wealth requires patience and diversification.

Re: We haven't seen the worst of what gambling and prediction markets will do

#662

Post by Miraste »

HelloMcFly wrote: post #592
vovavili wrote: post #577

Earlier quoted context omitted.

At the moment being, Polymarket has an enormous reputational incentive against behaving like a predatory gambling company. People rely on it as a kind of decentralized alternative to New York Times. Distorting this effect would be very short-sighted.

I believe they are incentivized to discourage insider bets and essentially "rigged" wins. I do not think they will ever be able to control the problem of insiders leveraging guaranteed knowledge to take money for the poor suckers who don't know the game they are playing. Maybe that's too pessimistic, but at this point I don't see how anything but a pessimistic view is warranted.

Rigged wins aren't a real problem. Everyone knows that sports betting apps are rigged, and it doesn't affect them at all. In fact, the latest explosion of customers has been accompanied by even more blatant rigging in the form of unwinnable multi-leg parlays. Hasn't slowed them down.

Re: We haven't seen the worst of what gambling and prediction markets will do

#663

Post by ses1984 »

DeathArrow wrote: post #635
vovavili wrote: post #561

Earlier quoted context omitted.

With proper constraints, there is a major positive externality in aggregating public and private information through market mechanisms. Robin Hanson wrote about this subject extensively. Dismissing it outright as a zero-sum game is a bit naive.

>With proper constraints, there is a major positive externality in aggregating public and private information through market mechanisms. Robin Hanson wrote about this subject extensively. Dismissing it outright as a zero-sum game is a bit naive. It's only gambling when you are betting of completely random events. If you know what the odds are of something happening, even with some approximation, then it is not gambli…

Why does knowing the odds make it not gambling?

The odds are known in a game of roulette, is that not gambling?

You can calculate the odds in games like blackjack to attempt to gain an edge, is that not gambling?

Re: We haven't seen the worst of what gambling and prediction markets will do

#664

Post by joelthelion »

Aerbil313 wrote: post #532
joelthelion wrote: post #499

There is a class of prediction markets that are useful and seem immune to most of these problems : play money prediction markets. I've been enjoying them for years; I feel they provide a useful service to understand what is going on in the world, and they don't seem to provide the perverse incentives that we are seeing here. Oh, and they seem to work just as well.

These "competitive forecasting" platforms seem very interesting. What do you need to be good at this sort of skill?

A good understanding of the world, your own capabilities, and how they relate to the capabilities of other players.

There is also some technical knowledge but that's easy to pick up.

Re: We haven't seen the worst of what gambling and prediction markets will do

#665

Post by Chris2048 »

InsideOutSanta wrote: post #625
Chris2048 wrote: post #461

Earlier quoted context omitted.

ok, what's buying milk at a corner shop a slippery slope to?

The extermination and/or enslavement of all mammals.

Oh, so the slope doesn't need to be plausible?

Re: We haven't seen the worst of what gambling and prediction markets will do

#666

Post by Miraste »

cortesoft wrote: post #341
Barrin92 wrote: post #134

Earlier quoted context omitted.

this is a false equivalence. Amazon and Meta have caused plenty of damage, companies in our capitalist economies are bad etc. But shipping you books or connecting you to other people isn't inherently evil. There's nothing wrong with the service itself. Gambling is. It's been a vice in virtually every culture for thousands of years. It's akin to peddling drugs. The practice itself is corrosive and destroys people. It'…

> There's nothing wrong with the service itself. Gambling is. I think this is waaaay too black and white. Gambling can be fun, and there isn't anything wrong with enjoying gambling in a healthy manner. It is very comparable to drinking, I think. I refuse to apologize for enjoying the occasional drink or the occasional game of poker. I like a poker game with friends, I enjoy sitting at a blackjack table for a few hour…

There is a line between a poker game with friends, or even a professional poker industry, and a sophisticated tech company operating a nationwide low-friction gambling app, incentivized to optimize harming its users as much as possible. This line was enshrined into law until recently.

Re: We haven't seen the worst of what gambling and prediction markets will do

#667

Post by _DeadFred_ »

kqr wrote: post #586
doginasuit wrote: post #585

Earlier quoted context omitted.

The often-repeated "wisdom of the crowds" justification is misapplied to online betting markets. Like people, crowds can either be wise or unwise depending on the situation. Famous experiments like guessing how many gumballs are in a jar work because each person who can see the jar has a source of valid information, and in aggregate that can be surprisingly accurate. You can't assume that the majority of individuals…

Nobody says this on assumption. It's well-evidenced. https://polymarket.com/accuracy https://www.metaculus.com/questions/track-record/

Please show the dollar/realized benefit to society VS (in response to OPs statement) the results don't "justify the cost, corruption and a loss of trust in institutions" along with a breakdown of the cost/negatives to society that result from those factors.

This isn't big oil (yet) you can't just externalize all the downside and say the product is a net benefit.

Re: We haven't seen the worst of what gambling and prediction markets will do

#668

Post by Terr_ »

bit-anarchist wrote: post #644
epolanski wrote: post #640

Earlier quoted context omitted.

Also, I really feel like so many of the people defending prediction markets don't understand the very basics of economy and behavioral science: incentives. You're creating a legalized system with the incentives to influence events to make terrible stuff happen. We've already seen huge bets on the deadline of US attack to Venezuela spike few hours/days before the actual aggression. Which means that insiders not only h…

And the naysayers would be right. They come from two approaches: - Property rights: bettors are waging using their own property at their own direct risk. To prohitbit such a thing is to violate their property rights, plain and simple; - Information aggregation: prediction markets originally appeared to help make informed decisions about an event by proof-of-stake. If I'm not mistaken, this idea was originally develop…

> bettors are waging using their own property [...] To prohitbit such a thing is to violate their property rights

This is technically true but doesn't deserve top-billing. Any fraudster or embezzler (or mugger or drunk-driver) will incidentally be risking some of their own property while exercising their right to control it.

> informed decisions about an event by proof-of-stake

A large chunk of the problem here occurs when people (politicians, judges, police, CEOs, etc.) are wagering assets and outcomes that aren't actually theirs, but things they control in (violated) trust. In other words, the personal "stake" of their overt bet is actually far too small.

> The latter is functionally the same as policemen/judges/prosecutors/prisons having an incentive to create more criminals. [...] we increase punishments

So... repercussions like "is is a crime for those people to possess a private account on the anonymous bribery website"?

Re: We haven't seen the worst of what gambling and prediction markets will do

#669

Post by mcmcmc »

bombcar wrote: post #467
mcmcmc wrote: post #142

Earlier quoted context omitted.

So are you advocating for the idea that the wealthy should be able to control history then, by nature of having the largest amount of betting capital?

Don't the wealthy already "control history" by having the "largest amount of capital"?

To some extent yes, so why make it easier for them? While also giving them another way to siphon wealth off the losers for betting against them?

Re: We haven't seen the worst of what gambling and prediction markets will do

#670

Post by marssaxman »

WalterBright wrote: post #391
marssaxman wrote: post #353

Earlier quoted context omitted.

It does both! There is no natural law which prevents the formation of a monopoly.

> It does both! No, it does not concentrate wealth. Wealth is not a fixed pie. In a free market, you get wealthy by creating wealth, not concentrating it. As for monopolies, competition is what prevents them.

Every market exists within a regulatory system, which exerts power over the participants in the market. Using wealth, you can acquire influence, and thereby direct the power of the regulatory system to inhibit your competition, or create a legal monopoly for yourself. A free market is not magic; people have to make it happen, and people have many motivations beyond the freedom of markets.

> In a free market, you get wealthy by creating wealth, not concentrating it.

You can do either, or both.

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