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philh comments on Prediction Markets are Confounded - Implications for the feasibility of Futarchy - Less Wrong Discussion

14 Post author: Anders_H 26 January 2015 10:39PM

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Comment author: philh 27 January 2015 04:11:23PM 0 points [-]

I'm a confused layman.

I'm not familiar with the difference between Do(Elect Clinton) and (Clinton Elected). Looking at the numbers, it seems that the first one is "Clinton is elected, either because that was going to happen anyway or because of an intervention", and the second one is "there was no intervention, and Clinton was elected"? (Or if there was an intervention, it was an unnecessary pro-Clinton one.)

However, if one were to condition on who actually was elected, we get different numbers: Conditional on being in a state where Hillary is elected, the probability of the US being nuked is 1/3; whereas conditional on being in a state where Jeb is elected, the probability of being nuked is ¼.

It seems like if we're talking about who was actually elected, then we should take into account an intervention, if there was one, and these numbers should both be 2/7?

We defined our contract as "Hillary is elected and the US is nuked". The probability of this occurring in 1/7; if we normalize by dividing by the marginal probability that Hillary is elected, we get 1/3 which is equal to Pr [Nuked | Clinton Elected].

Isn't this only if there's no intervention?

Comment author: ike 27 January 2015 04:14:58PM 1 point [-]

I'm not familiar with the difference between Do(Elect Clinton) and (Clinton Elected). Looking at the numbers, it seems that the first one is "Clinton is elected, either because that was going to happen anyway or because of an intervention", and the second one is "there was no intervention, and Clinton was elected"? (Or if there was an intervention, it was an unnecessary pro-Clinton one.)

I understood it like this: there is a group of people who will commit to changing the election somehow iff the prediction market says it would be good. If the market is neutral, then whoever gets more votes will win.

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