The concept of epistemic bits is quite interesting! In Manifold terms, that would be like comparing the total amount of M$ one has amassed (maybe in a specific community like the one for AI) and using them as weights for how seriously to take two commentators.
I worked through an example just to prove the math to myself:
Eliezer and Paul both start with 1000 M$.
For Eliezer to end up with 2x the epistemic weight, Paul wagers 333 M$ (so the end result would be 1333:667 or ~2:1).
Taking 9:1 odds (roughly geometric mean between 8% and 16%), Eliezer puts up 37 M$.
So if Paul wins, he ends up at 1037:963, or ~1.08:1
I bet the market down from 58% to 40% which seems like a steal on the merits. Seems like it will mostly lock up my money though given the long resolution timeline, unless people eventually settle down to a significantly lower consensus.
Yes—this surfaces the issue with long-term markets, where it’s not worth the investment lockup when you could be trading on issues with a shorter resolution time.
We have a few tentative proposals to address this:
Issue small interest-free loans on the first M$10 bet (Scott’s proposal)
Margin loans against the value of of your long-term bets
Set up derivative markets (e.g. “What will the IMO market be at on April 1st 2022”)
Demurrage, where we charge a fee for cash balances
I’m partial to Scott’s proposal, though it may be technically tricky to implement...
I set up a Manifold market for this, for anyone who’d like to bet along: https://manifold.markets/Austin/will-an-ai-get-gold-on-any-internat
The concept of epistemic bits is quite interesting! In Manifold terms, that would be like comparing the total amount of M$ one has amassed (maybe in a specific community like the one for AI) and using them as weights for how seriously to take two commentators.
I worked through an example just to prove the math to myself:
Eliezer and Paul both start with 1000 M$.
For Eliezer to end up with 2x the epistemic weight, Paul wagers 333 M$ (so the end result would be 1333:667 or ~2:1).
Taking 9:1 odds (roughly geometric mean between 8% and 16%), Eliezer puts up 37 M$.
So if Paul wins, he ends up at 1037:963, or ~1.08:1
I bet the market down from 58% to 40% which seems like a steal on the merits. Seems like it will mostly lock up my money though given the long resolution timeline, unless people eventually settle down to a significantly lower consensus.
Yes—this surfaces the issue with long-term markets, where it’s not worth the investment lockup when you could be trading on issues with a shorter resolution time.
We have a few tentative proposals to address this:
Issue small interest-free loans on the first M$10 bet (Scott’s proposal)
Margin loans against the value of of your long-term bets
Set up derivative markets (e.g. “What will the IMO market be at on April 1st 2022”)
Demurrage, where we charge a fee for cash balances
I’m partial to Scott’s proposal, though it may be technically tricky to implement...