4 ms·

> I'm not convinced. If there's no direct profit, I can't imagine talented people are going to waste that much time on it. Wikipedia, reddit, HN, and stackover

by darawk 6y ago

> I'm not convinced. If there's no direct profit, I can't imagine talented people are going to waste that much time on it. Wikipedia, reddit, HN, and stackoverflow would beg to differ. Reputation drives people to expend incredible amounts of effort. In 2002 I would have had the same intuition you do. But i've seen reputation systems and social credit build too many incredible things to feel that way anymore. > Reputation is also not that great of a proxy, it encourages strategies which push the risks into the tails. If it's money, you have a much stronger incentive to reduce your own tail risk since your entire livelihood is at stake, rather than just your ability to play the local game. I do think there's a reasonable argument that the risk curves will be different, but I don't really see how that cashes out in an inaccurate overall system. It seems to me that as long as reputation gets allocated to those who are consistently correct, the system should work pretty well.

bananaface 6y ago
There is no StackOverflow for trading, or betting. Nobody gives away their edge for free, although they may give away their trades. >I don't really see how that cashes out in an inaccurate overall system Imagine a strategy that has a 50% chance of blowing you up completely over 10 years, but nets you 50% more profit if it works. The average return of this strategy is 25% less than a safe strategy (zero risk, zero gain), but it has a 50% chance of winning in this marketplace. If it were real money, nobody would go near it. Ok, now imagine there's 100 people running strategies with that profile and 100 running the safe strategy. All of the top spots will be held by the suicidal strategy. This is an artificial example but you get the point. Real money forces you to avoid that risk profile as soon as you identify it.
- crazygringo 6y ago
  This is exactly it. I'm surprised I had to scroll down this far to find the actual explanation.
- darawk 6y ago
  > There is no StackOverflow for trading, or betting. Nobody gives away their edge for free, although they may give away their trades. This isn't trading, though. It's forecasting. You could make that argument about the sub-category of economic forecasts, perhaps. But not about more general things, like presidential elections. > Imagine a strategy that has a 50% chance of blowing you up completely over 10 years, but nets you 50% more profit if it works. The average return of this strategy is 25% less than a safe strategy (zero risk, zero gain), but it has a 50% chance of winning in this marketplace. If it were real money, nobody would go near it. People go near real money strategies like that all the time. That's all WallStreetBets is, or the financial crisis, for that matter. I do take your point that this behavior may be more pronounced in a community like this, but I don't think it invalidates the model.
  - bananaface 6y ago
    >This isn't trading, though. It's forecasting. That's not my point. The point is people don't give away predictive edges for internet points (or reputation). There are many reasons why but the lack of a betting & trading StackOverflow is one symptom. It's just an example, but TBH it's not that relevant since this market wouldn't involve revealing edges. >People go near real money strategies like that all the time. Absolutely, and it's a problem with real funds. But: - It's a lot rarer. - There's a much stronger incentive for other people to quietly take the opposite sides of those bets, which normalises the market. We'll see what effect it has, but I think this marketplace will just end up following the values on PredictIt.
YetAnotherNick 6y ago
The average answer/comment is pretty bad in most of the sites you listed. All of those use heavy ordering to work. Unlike say if I ask say kubernetes expert in my company some question, the chances of it being pure bad is very less compared to if I ask in stack overflow. Wikipedia has altogether different politics and incentive that it is not that open for most of the popular articles.
- darawk 6y ago
  Yes, but that's why this forecasting system will not be weighted by the average. It will be weighted by the historical accuracy of the forecaster.
  - bananaface 6y ago
    Right now there seems to be a cap of 99 tokens per person for each auction, which will clamp the effect rich players have on the weightings (to the point of it being much closer to an average). They may remove that in the future of course. https://news.ycombinator.com/item?id=24658738 https://news.ycombinator.com/item?id=24658738
- throwaway0a5e 6y ago
  Not only is the average not that great but the fact that the lowest common denominator buries the actual experts on some of those platforms is maddening.
throwaway0a5e 6y ago
>Wikipedia, reddit, HN, and stackoverflow would beg to differ Ha! It's pretty obvious that on all those platforms the "people with tons of points" cohort is overwhelmingly made up of people who've gamed the system (which in pretty much all cases takes the form of "producing high volumes of low quality content that caters to the lowest common denominator of the local user demographics and doing so for a long time").

by darawk 6y ago

bananaface 6y ago

There is no StackOverflow for trading, or betting. Nobody gives away their edge for free, although they may give away their trades. >I don't really see how that cashes out in an inaccurate overall system Imagine a strategy that has a 50% chance of blowing you up completely over 10 years, but nets you 50% more profit if it works. The average return of this strategy is 25% less than a safe strategy (zero risk, zero gain), but it has a 50% chance of winning in this marketplace. If it were real money, nobody would go near it. Ok, now imagine there's 100 people running strategies with that profile and 100 running the safe strategy. All of the top spots will be held by the suicidal strategy. This is an artificial example but you get the point. Real money forces you to avoid that risk profile as soon as you identify it.

crazygringo 6y ago
This is exactly it. I'm surprised I had to scroll down this far to find the actual explanation.
darawk 6y ago
> There is no StackOverflow for trading, or betting. Nobody gives away their edge for free, although they may give away their trades. This isn't trading, though. It's forecasting. You could make that argument about the sub-category of economic forecasts, perhaps. But not about more general things, like presidential elections. > Imagine a strategy that has a 50% chance of blowing you up completely over 10 years, but nets you 50% more profit if it works. The average return of this strategy is 25% less than a safe strategy (zero risk, zero gain), but it has a 50% chance of winning in this marketplace. If it were real money, nobody would go near it. People go near real money strategies like that all the time. That's all WallStreetBets is, or the financial crisis, for that matter. I do take your point that this behavior may be more pronounced in a community like this, but I don't think it invalidates the model.
- bananaface 6y ago
  >This isn't trading, though. It's forecasting. That's not my point. The point is people don't give away predictive edges for internet points (or reputation). There are many reasons why but the lack of a betting & trading StackOverflow is one symptom. It's just an example, but TBH it's not that relevant since this market wouldn't involve revealing edges. >People go near real money strategies like that all the time. Absolutely, and it's a problem with real funds. But: - It's a lot rarer. - There's a much stronger incentive for other people to quietly take the opposite sides of those bets, which normalises the market. We'll see what effect it has, but I think this marketplace will just end up following the values on PredictIt.

YetAnotherNick 6y ago

The average answer/comment is pretty bad in most of the sites you listed. All of those use heavy ordering to work. Unlike say if I ask say kubernetes expert in my company some question, the chances of it being pure bad is very less compared to if I ask in stack overflow. Wikipedia has altogether different politics and incentive that it is not that open for most of the popular articles.

darawk 6y ago
Yes, but that's why this forecasting system will not be weighted by the average. It will be weighted by the historical accuracy of the forecaster.
- bananaface 6y ago
  Right now there seems to be a cap of 99 tokens per person for each auction, which will clamp the effect rich players have on the weightings (to the point of it being much closer to an average). They may remove that in the future of course. https://news.ycombinator.com/item?id=24658738 https://news.ycombinator.com/item?id=24658738
throwaway0a5e 6y ago
Not only is the average not that great but the fact that the lowest common denominator buries the actual experts on some of those platforms is maddening.

throwaway0a5e 6y ago

>Wikipedia, reddit, HN, and stackoverflow would beg to differ Ha! It's pretty obvious that on all those platforms the "people with tons of points" cohort is overwhelmingly made up of people who've gamed the system (which in pretty much all cases takes the form of "producing high volumes of low quality content that caters to the lowest common denominator of the local user demographics and doing so for a long time").