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Self-Enforcing Protocols
- ube 17y agoHow can you not like an article that involves cake, pirates, and property taxes? One thing that I wonder is how is a self reinforcing transaction affected when the third parties that used to mediate it are shut out. For example, certificate authority companies that are no longer needed. Furthermore, the "all hands" in the room as opposed to secret ballot voting - while on the surface it is self reinforcing from a social perspective it wouldn't really work (i.e. the coercion he mentioned and also the lemming effect where someone votes with their crowd delaying raising their hand just enough to see what the consensus is). Finally, the collusion and breakage of a self-reinforcing system like the pirate example shows that a self-reinforcing protocol is situationally dependent. What are the chances that at least one pirate will collude with the captain? (I bet the chance is quite high considering the nature of pirates) As opposed to the property tax example which seems to be a very good use of such a protocol.
- pavel_lishin 17y agoIsn't the point of a self-reinforcing transaction that it doesn't need a third-party mediator?
- jedi_stannis 17y agoI think his point was that current third party mediators will not be happy to be cut out of the equation. Even though the system will be more efficient without them, they will try to do whatever they can to still get their share of the transaction.
- ube 17y agoThanks - that is exactly what I meant.
- niyazpk 17y agoInstead of giving the amount to the captain, they could throw it away to the sea. Nobody would cheat then. In real life situations, you may want to replace the sea by the government or some kind of common fund in the domain.
- silentOpen 17y agoInteresting idea but no parties in the protocol would be motivated to do that. This might be useful in a situation where a group entity exists that is approximately the same size as the division group -- e.g. an endowment, shared property, common business, or co-op.
- eru 17y ago> Nobody would cheat then. Depends. Perhaps somebody would try to bully (i.e. play a game of chicken http://en.wikipedia.org/wiki/Chicken_(game) http://en.wikipedia.org/wiki/Chicken_(game)): "Either you lower your share in my favour, or I will claim too much and you get nothing."
- billswift 17y agoIt wouldn't work if it was explicitly known. The others could just as easily decide to cut him out of the distribution entirely.
- eru 17y agoYes. Or if the victim could commit to not yielding to threats like this beforehand. Being able to commit oneself is of huge importance in games like chicken (http://en.wikipedia.org/wiki/Chicken_(game) http://en.wikipedia.org/wiki/Chicken_(game)).
- donaldc 17y agoIf I were a pirate who had little gold to lose, and a grudge against some of my fellow pirates, I could always play the spoiler and cause everyone's gold to go to the captain or into the sea...
- bsaunder 17y agoI think the property tax example is just an inverse pirate scenario. (the landowner is the pirate needing the cooperation of the captain (the head of the land acquisition authority)). Granted a much weaker position to negotiate from.
- bigwill 17y agoYeah, I like the comments in this sub-thread. These protocols can suffer from Maginot Line type of security. Also, they can provide an illusion of propriety that cheaters can point to when accused and use that to distract, say, a jury from however it is they really cheated. It's important to understand these protocols' failings.
- Herring 17y agoAnyone remember the protocols for 3+ people dividing the cake? I cant find the article I saw. Edit: Still can't find the article, but wikipedia mentions the relevant research papers. http://en.wikipedia.org/wiki/Cake_cutting http://en.wikipedia.org/wiki/Cake_cutting
- sethg 17y agoIIRC the protocol for a three-way split is: One party gradually moves the knife, pointing downward and poised to slice, over the surface of the cake, until either of the other two says "cut". The person who calls "cut" gets that slice. The remainder of the cake is divided according to the cut-and-choose protocol.
- pavel_lishin 17y agoWouldn't the two people not cutting wait 'til the knife was in the middle, and then try to yell 'cut!' as fast as they could? First person to yell "cut" would get half of the cake, and the other two would get a quarter apiece...
- nostrademons 17y agoAll parties can say cut, including the cutter. If he calls it, he gets the part behind the knife, just like any of the others. In the above scenario, the cutter has an incentive to yell cut as soon as the knife passes the 1/3 point, then each of the remaining people has an incentive to yell cut when it's passed half of the remainder (or 1/3 of the total).
- deleted 17y ago[deleted]
- anamax 17y agoThis assumes that the cake is uniform, and most cakes aren't. If the cutter prefers frosting and knows that the other person doesn't, the cutter can arrange to get a larger share than she'd get if roles were reversed. I think that the problem can be fixed by giving all participants knives so they're all cutters.
- chrisduesing 17y agoI would love to hear an idea for how this could be used in an online gaming situation. 1. Imagine a simple turn based rpg combat system where each side rolls a hit die and the other side a block die and then they compare. given this premise, what needs to be modified to prevent cheating? 2. Once 1 is solved, how much does a fps situation where network lag effects player's perception of each others location complicate the procedure?
- te_platt 17y agoYou might want to check out Applied Cryptography by Bruce Schneier. It explains how to dice as well as cards over a network without being able to cheat. It also goes into many other areas in great detail.
- chrisduesing 17y agoI just checked the book using Amazon's "look inside" feature. It appears that his example is how to use cryptography to hide what cards you have from the other player until it is time to reveal them. I am more interested in how to apply the ideas from this article to involve an open, self enforcing protocol rather than data hiding.
- lonestar 17y agohttp://en.wikipedia.org/wiki/Coin_flipping http://en.wikipedia.org/wiki/Coin_flipping See the section "Coin flipping in telecommunications" for a cryptographic scheme for verifiable coin flipping across the internet. This is a specific example from the category of commitment schemes.
- bockris 17y agoIn the comments: http://www.schneier.com/blog/archives/2009/08/self-enforcing.html#c387837 http://www.schneier.com/blog/archives/2009/08/self-enforcing... someone brings up the situation where there is only one item (Grandma's antique mirror) and how you can use the shotgun clause to determine who gets the item. I'm reminded of the chapter (70) in Cryptonomicon where they were dividing the assets of an estate. All of the children got to rank items on 2 scales, emotional attachment and dollar value. The choices on both axes were scaled to between 0 and 1. Then they were going to use software to determine an equal split on both scales amongst all recipients.
- pavel_lishin 17y agoAnd Stephenson then went on to mention, through Randy and his uncle (or was it his father?) that the problem itself was incredibly difficult, and they were going to borrow some time on a huge machine to solve it. And then Randy cheated, anyway.
- huhtenberg 17y ago> The choices on both axes were scaled to between 0 and 1. That I don't remember, but I do remember that they had sex on one of the furniture items in question :)
- bockris 17y agodifferent chapter (41) and it was Tom Howard, not Randy who had sex on a Gomer Bolstrood dresser. (The reason I can quote chapters is that I have an OCR'ed scan of the book that I found on the internet. a quick search on the word 'stockings' found the right chapter.)
- codyrobbins 17y agoHere’s a self-enforcing protocol for determining property tax: the homeowner decides the value of the property and calculates the resultant tax, and the government can either accept the tax or buy the home for that price. Sounds unrealistic, but the Greek government implemented exactly that system for the taxation of antiquities. It was the easiest way to motivate people to accurately report the value of antiquities. Yeah, it does sound unrealistic. What if the homeowner truthfully and in good faith reports an accurate value for their home, and the government decides to purchase it anyways? I would not like the government to have the ability to instantly render me homeless.
- run4yourlives 17y agoWhat if the homeowner truthfully and in good faith reports an accurate value for their home, and the government decides to purchase it anyways? That assumes that the government can't already do this. They most certainly can. Even better, they can do stupid things like build High-tension powerlines the next lot over, rezone your lot into industrial, etc, etc. This doesn't really give the government any more power, but it removes a lot of red tape, plus it ensures you get fair market for your home. Assuming you over-report the value, you'd be making a profit on the sale - enough that moving wouldn't be much of a issue for you. It's actually quite brilliant as it has the effect of raising taxes! If my home is market valued at $500K, I'd probably suggest I pay taxes on $550K, just so that I'd have that extra $50K in pocket if I'm inconvieneced.
- codyrobbins 17y agoSure, the government can already do this, but certainly not so easily. Things like building high-tension powerlines or rezoning require many steps involving proposals, reviews, environmental impact studies, community input, etc. before final approval. There's also eminent domain, which I didn't mention, but again even that requires lots of review, justification, general consensus, and approval. There is definitely a difference between those things and the government being able to arbitrarily seize your property with no justification at all, other than that you've arguably undervalued it, regardless of whether they pay you what you valued it at. So, while this may not really give the government power that it doesn't already have per se, what it's doing is removing a ton of barriers. Assuming you over-report the value, you'd be making a profit on the sale - enough that moving wouldn't be much of a issue for you. This is assuming that all you care about is money. What if you don't want to give up your home regardless of how much they pay you for it? There are some things people are not willing to sell for any price. And being forced to relocate would be far more than an inconvenience to some people. In these cases, how much should you be forced to overvalue your home by as insurance that the government won't arbitrarily seize it if you get on someone's bad side? 25%? 50%? 200%?
- makmanalp 17y agoSelf-enforcing protocols are safer than other types because participants don't gain an advantage from cheating. Barter is a self-enforcing protocol: nobody needs to facilitate the transaction or resolve disputes. It just works. Except when bartering, participants do gain an advantage from cheating.
- dbz 17y agoI think the point was that it is hard for participants to cheat, the owner isn't going to go lower than a certain amount; thus, the owner is always going to break even or profit. If the owner puts the price too high then the buyer is no longer going to be a buyer, but a a person who is walking away from the deal. Kind of self-enforced because the person who is selling is not going to make money by putting too high a price on goods.
- wwalker3 17y agoAnd it's easy to cheat in bartering -- just don't tell the other party that your goods have some hidden flaw. If I barter you my old laptop that crashes when you leave it on more than an hour, you're going to be mad later when you find out I didn't tell you, and you'll have to appeal to a third party for justice if I'm bigger or stronger than you.
- bsaunder 17y agoOr just barter it away to someone else (with or without telling the truth). ;)
- billswift 17y agoBigger or stronger won't stop a bullet. Anyone who cheats in a way that seriously damages the other, in a world that has guns in it, is a f*cking idiot. EDIT: This is known as "deterrence" if the potential malefactor is fairly bright and "evolution in action" if not.
- silentOpen 17y agoThis depends on the perfection of market information. If both participants can perfectly determine the value of their and their adversary's goods, no one can or will cheat. So barter should work for metals traders but not cattle traders (but they have other problems...).
- jorgeortiz85 17y agoHere’s a self-enforcing protocol for determining property tax: the homeowner decides the value of the property and calculates the resultant tax, and the government can either accept the tax or buy the home for that price. Sounds unrealistic, but the Greek government implemented exactly that system for the taxation of antiquities. It was the easiest way to motivate people to accurately report the value of antiquities. I had an idea a while ago about stopping domain name squatters by using a similar protocol to price and tax domain names. You'd be required to report the "fair value" of each domain you owned. All your domains (maybe there could be exceptions for trademarks) would be implicitly for sale at that fair price. To keep the reported price from being too high, you'd have to pay some fraction of that price as a yearly domain name tax. That way, if anyone has a better use for your domain than you do, they can just buy it from you. Of course, if you build a brand and a trademark, you should have some protection from competitors just buying your domain. Maybe only other similar trademark holders could compete for your domain (eg, Apple Computers and Apple Music could fight it out to see who gets more value out of apple.com).
- Periodic 17y agoI see domain names being too close to trademarks for this to be viable. For many companies the domain name came first, and the trademark came second (e.g. Flickr, bit.ly, del.icio.us). If others could somehow come in and buy your domain name it could really ruin your business. People think of many online businesses as synonymous with their URL, and there is a lot of work that goes into associating the two. The tax would really hurt small startups. I think domain names should simply have more protections in a way similar to trademarks, and there should be a way to dispute domains as being trademark infringing.
- jorgeortiz85 17y agoLet's say you can pay your property tax in advance, so up to one or two years in advance. After that period, others can threaten to buy your domain. If you manage to build a viable business out of it within a year or two, you can trademark the name and hold on to it for as long as you're doing business under that trademark. If you haven't built a trademark around it, then you either continue paying your tax or risk getting bought out.
- pkulak 17y ago"an open show of hands in a room -- one that everyone in the room can count for himself -- is self-enforcing" This is his second example (where you can complain to someone else if it's unfair) which he just got done saying _wasn't_ self-enforcing. Sure I can count for myself, but if the official number is not my own, I need a third party.
- sketerpot 17y agoPlus you can vote for more than one candidate. This is a good thing, I think -- approval voting is a very well-behaved voting system -- but perhaps not what people were trying to do. http://en.wikipedia.org/wiki/Approval_voting http://en.wikipedia.org/wiki/Approval_voting
- Locke 17y agoCut-and-choose is known as the "pie rule" in the abstract gaming world. For games with a clear first move advantage the pie rule is sometimes applied to balance the game. The first player moves, and the second player then has a choice of continuing the game or switching sides. It is therefore in the best interests of the first player to choose a fair move. Naturally, this only works if the first move possibilities include moves that range from good to bad. Still, it's a nice example of a meta rule that can be applied to most games.
- ionfish 17y agoIt's often cited in political philosophy as an example of a fair procedure.