It seems to me that this problem assumes that the predictor both does and does not predict correctly.
When determining the predictor's actions, we assume that it forsees the agent's two-boxing.
When determining the agent's actions, we assume that the simulated predictor behaves the same regardless of the agent's decision.
The question thus seems to contradict itself.
In this problem the predictor predicts correctly. Can you explain why you think it predicts incorrectly?
Some people on LW have expressed interest in what's happening on the decision-theory-workshop mailing list. Here's an example of the kind of work we're trying to do there.
In April 2010 Gary Drescher proposed the "Agent simulates predictor" problem, or ASP, that shows how agents with lots of computational power sometimes fare worse than agents with limited resources. I'm posting it here with his permission:
About a month ago I came up with a way to formalize the problem, along the lines of my other formalizations:
Also Wei Dai has a tentative new decision theory that solves the problem, but this margin (and my brain) is too small to contain it :-)
Can LW generate the kind of insights needed to make progress on problems like ASP? Or should we keep working as a small clique?