Extracting Value from Inadequate Equilibria

by eapache2 min read18th May 202012 comments


World OptimizationRationality

[Much expanded from my comment here. Pure speculation, but I’m confident that the bones of this make sense, even if it ends up being unrealistic in practice. Cross-posted from Grand, Unified, Crazy.]

A lot of problems are coordination problems. An easy example that comes to mind is scientific publishing: everybody knows that some journal publishers are charging ridiculous prices relative to what they actually provide, but those journals have momentum. It’s too costly for any individual scientist or university to buck the trend; what we need is coordinated action.

Eliezer Yudkowsky talks about these problems in his sequence Inadequate Equilibria, and proposes off-hand the idea of a Kickstarter for Coordinated Action. While Kickstarter is a great metaphor for understanding the basic principle of “timed-collective-action-threshold-conditional-commitment”, I think it’s ultimately led the discussion of this idea down a less fruitful path because Kickstarter is focused on individuals, and most high-value coordination problems happen at the level of institutions.

Consider journal publishing again. Certainly a sufficient mass of individual scientists could coordinate to switch publishers all at once. But no matter what individual scientists agree to, this is not a complete or perfect solution:

  • Almost no individual scientists are paying directly for these subscriptions – their universities are, often via long-term bulk contracts.
  • University hiring decisions involve people in the HR and finance departments of a university who have no interest in a coordinated “stop publishing in predatory journals” action. They only care about the prestige and credentials of the people they hire. Publications in those journals would still be a strong signal for them.
  • Tenure decisions involve more peer scientists than hiring, but would suffer at least partly from the same issue as hiring.

What’s needed for an action like this isn’t a Kickstarter-style website for scientists to sign up on – it’s coordinated action between universities at an institutional level. Many of the other examples discussed in Inadequate Equilibria fit the same pattern: the problems with healthcare in the U.S. aren’t caused by insufficient coordination between individual doctors, they’re caused by institutional coordination problems between hospitals, the FDA, and government.

(Speaking of government, there’s a whole host of other coordination problems [climate change comes to mind] that would be eminently more solvable if we had a good mechanism for coordinating the various institutions of government between countries. The United Nations is better than nothing, but doesn’t have enough trust or verification/enforcement power to be truly effective.)


The problem with the Kickstarter model is that institutions qua institutions are never going to sign up for an impersonal website and pledge $25 over a 60-day campaign to switch publishing models. The time scale is wrong, the monetary scale is wrong, the commitment level is wrong, the interface is wrong… that’s just not how institutions do business. Universities and hospitals prefer to do business via contracts, and lawyers, and board meetings. Luckily, there’s still value to be extracted here, which means that it should be possible to make a startup out of this anyway; it just won’t look anything like Kickstarter.

Our hypothetical business would employ a small cadre of lawyers, accountants, and domain experts. It would identify opportunities (e.g. journal publishing) and proactively approach the relevant institutions through the proper channels. These institutions would sign crafted, non-trivial contracts bound to the success of the endeavour. The business would provide fulfillment verification and all of the other necessary components, and would act as a trusted third-party. The existence of proper contracts custom-written by dedicated lawyers would let the existing legal system act as an enforcement mechanism. Since the successful execution of these contracts would provide each institution with significant long-term value, the business can fund itself over the long haul by taking a percentage of these savings off the top, just like Kickstarter.

This idea has a lot of obvious problems as well (the required upfront investment, the business implications of having its income depend on one or two major projects each year, the incentives it would have to manufacture problems, etc) but with a proper long-term-focused investor on board it seems like this could turn into something quite useful to humanity as a whole. Implementing it is well outside of my current skillset, but I would love to see what some well-funded entrepreneur with the right legal chops could make of something like this.