PM Info: Reliable and Common

[psztorc]

Normally, when you learn something, you can't easily share what you learned. You can only share what you say you learned. There's a big difference.

For example, you could personally have gone into a library for 5 years and read everything about acorns. When you're done, though, all you can tell people is that you think you know about acorns.

But wait, can't you just impress them with your acorn vocabulary? And your acorn dialogues, and your plan for efficient acorn-based power-generation? Actually, you can't at all! Your audience hasn't read those acorn books, and so they have no idea what you're talking about. A mediocre actor could simply improvise lines about acorns, into acorn-vocab-rich sentences that have nothing to do with reality. The public knows it, too, and so won't care about what you have to say.

You might call the librarian(s) as witnesses to your scholarship, but I can simply find a second mediocre-actor to be a fake-librarian. You might graduate from Impressive University concentrating in Acorn Studies, but that takes a ton of time and money, and I can (more cheaply) hire my own IU-grad mediocre-actor to argue against you. ( And the students did not synthesize any new/unique Acorn info while they were there, as the same courses/curriculum were available to all students. Plus, IU probably just admitted a bunch of perfectionists/conformists with rich/connected parents, or a feel-good-story/minority background that would make IU look good in its Trustee-Reports. )

The problem gets much, much worse. Lets say that you do convince some people in the audience that the Acorn Power Plant is a great idea, but meanwhile I convince some people that the APP is a terrible idea, and that anyone who supports it should be made fun of and exiled from society. What are your supporters going to think and do? Faced with challenging the status quo for uncertain benefits amid certain punishment, they will think: " I know that I want the APP, but does anyone else want it? ". Unfortunately, it is likely that they will all simultaneously think this, and all simultaneously remain silent. Then you will be left to stand alone (and exiled), or only a bunch of fringe counterculturalist pseudo-hipster extremists (eager to prove how contrarian they are) will stand with you (and those guys always do something embarrassing).

People who learn the answer often leave the conversation, as the effort spent trying to convince others concerning matters such as (my personal examples) the minimum wage vs guaranteed income, "buy american", pro-manufacturing, entitlement-sustainability, farm subsidies, etc (all of which are essentially settled issues among professionals of all persuasion) is simply not worth it. Thus, a debate remains where none really exists.

Prediction Markets, as you may be guessing, do not have these problems! When the price of  ( Electricity Cost | Build APP=TRUE ) falls, reflecting cheaper energy with the Acorn Power Plant, everyone involved knows that the consensus changed to be more-favorable to "the APP is a good idea". But, far more importantly, everyone knows that every single other person knows that the consensus explanation changed. Those disagreeing are now automatically on the defensive.

I should say that PMs haven't yet completely dodged this problem. Usually, people will directly attack the premise that PMs are accurate (and therefore not a source of knowledge, let alone common knowledge). But even this problem is self-solving. Over time, the accuracy of PMs manifests itself empirically, even if some people are unable or unwilling to understand exactly why they are always so accurate.