“Yeah, that’s if you have perfect information, so anyone else can see whatever you can see. But, realistically, you have a lot of private information.”
“Do we? Predict-O-Matic is an algorithm. Its predictive strategies don’t get access to private coin flips or anything like that; they can all see exactly the same information. So, if there’s a manipulative strategy, then there’s another strategy which undercuts it.”
“Right, that makes sense if you can search enough different strategies for them to cancel each other out. But realistically, you have a small population of strategies. They can use pseudorandomization or whatever. You can’t really expect every exploit to get undercut.”
You know it’s worse than that. Predict-O-Matic runs on a local search which only represents a single hypothesis at a time, and modifies the hypothesis.
I intuitively feel like the “You know it’s worse than that” doesn’t fit in here. Isn’t the problem they are discussing that when there are different hypotheses the hypotheses have an incentive to create information in the market which they can then exploit, so it would actually be better when there’s only one hypothesis?
That said, I don’t think that “just one hypothesis” is a good framing in this case and that any sufficiently good predictor (or “hypothesis”) will have to have sub-hypotheses where probably the same problem applies.
Or maybe I don’t understand what you were trying to say here.
This post is amazing!
Re:
I intuitively feel like the “You know it’s worse than that” doesn’t fit in here. Isn’t the problem they are discussing that when there are different hypotheses the hypotheses have an incentive to create information in the market which they can then exploit, so it would actually be better when there’s only one hypothesis?
That said, I don’t think that “just one hypothesis” is a good framing in this case and that any sufficiently good predictor (or “hypothesis”) will have to have sub-hypotheses where probably the same problem applies.
Or maybe I don’t understand what you were trying to say here.