The source is here. I'll restate the problem in simpler terms:
You are one of a group of 10 people who care about saving African kids. You will all be put in separate rooms, then I will flip a coin. If the coin comes up heads, a random one of you will be designated as the "decider". If it comes up tails, nine of you will be designated as "deciders". Next, I will tell everyone their status, without telling the status of others. Each decider will be asked to say "yea" or "nay". If the coin came up tails and all nine deciders say "yea", I donate $1000 to VillageReach. If the coin came up heads and the sole decider says "yea", I donate only $100. If all deciders say "nay", I donate $700 regardless of the result of the coin toss. If the deciders disagree, I don't donate anything.
First let's work out what joint strategy you should coordinate on beforehand. If everyone pledges to answer "yea" in case they end up as deciders, you get 0.5*1000 + 0.5*100 = 550 expected donation. Pledging to say "nay" gives 700 for sure, so it's the better strategy.
But consider what happens when you're already in your room, and I tell you that you're a decider, and you don't know how many other deciders there are. This gives you new information you didn't know before - no anthropic funny business, just your regular kind of information - so you should do a Bayesian update: the coin is 90% likely to have come up tails. So saying "yea" gives 0.9*1000 + 0.1*100 = 910 expected donation. This looks more attractive than the 700 for "nay", so you decide to go with "yea" after all.
Only one answer can be correct. Which is it and why?
(No points for saying that UDT or reflective consistency forces the first solution. If that's your answer, you must also find the error in the second one.)
Once I have been told I am a decider, the expected payouts are:
For saying Yea: $10 + P$900 For saying Nay: $70 + Q$700
P is the probability that the other 8 deciders if they exist all say Yea conditioned on my saying Yay, Q is the probability that the other 8 deciders if they exist all say Nay conditioned on my saying Nay.
For Yay to be the right answer, to maximize money for African Kids, we manipulate the inequality to find P > 89% - 78%*Q The lowest value for P consistent with 0<=Q<=1 is P > 11% which occurs when Q = 100%.
What are P & Q? All we are told about the other deciders if they exist is that they are "people who care about saving African kids." With only that information, I can't see how to rationally use anything other than ~0.5% = P = Q, that is, our prior probability that any other decider says yay or nay is 50%, so getting all 8 of them to give the same answer of Yay or Nay has prior probability of (~(1/2)^8). Any other assumption of a different prior given the statement of the problem seems irrational to me.
So with P & Q on the small side, the correct decision is to pick "Nay." The error in the original post analysis of the case for picking Yay was assuming that the value of P is 1, that if I picked Yay that all people in the class of "people who care about African Kids" would also pick Yay. As stated above, from the information we have the rational prior estimate of that probability P is about 0.5%.
I would go further and say what about updating probabilities based on what we see in the answers here? If anything, they decrease the probability of P (everybody picks Yay), as more people seem to favor Nay than Yay. But this little bit of peeking below the fold is not needed for the estimate.
This suggests to me that you actually can coordinate with everyone else, but the problem isn't clear on whether or not that's the case.