Would there be a problem when speculators can create stocks in the conditional case? As in if a decision C harms me, can i create and sell loads and loads of C stock, and not having to actually go through the trade when C is not enforced (due to the low price i’ve caused)?
In the simple conditional case with N possible outcomes, you are (in the basic case) paying $1 to create 2N stocks: W|D_i and (1-W)|D_i for each of the N decisions D_i, where W is the agreed welfare metric ranging from 0 to 1. When decision n is implemented and the outcome measured, the W|D_n and (1-W)|D_n stocks pay out appropriately.
So yes, if you never sold your |D_n stocks then you get $(W + 1-W) = $1 back. However, you don’t have an unlimited number of dollars and can’t create an unlimited number of stocks.
Would there be a problem when speculators can create stocks in the conditional case? As in if a decision C harms me, can i create and sell loads and loads of C stock, and not having to actually go through the trade when C is not enforced (due to the low price i’ve caused)?
In the simple conditional case with N possible outcomes, you are (in the basic case) paying $1 to create 2N stocks: W|D_i and (1-W)|D_i for each of the N decisions D_i, where W is the agreed welfare metric ranging from 0 to 1. When decision n is implemented and the outcome measured, the W|D_n and (1-W)|D_n stocks pay out appropriately.
So yes, if you never sold your |D_n stocks then you get $(W + 1-W) = $1 back. However, you don’t have an unlimited number of dollars and can’t create an unlimited number of stocks.