Many people analyze and discuss the policies that might be chosen by organizations such as governments, charities, clubs, and firms. We economists have a standard set of tools to help with such analysis, and in many contexts a good economist can use such tools to recommend particular policy options. However, many have criticized these economic tools as representing overly naive and simplistic theories of morality. In response
"contractarianism claims that moral norms derive their normative force from the idea of contract or mutual agreement" Dealism does not make claims about morality; it is instead about wants. https://plato.stanford.edu/...
Vocabulary question: Is there a difference between dealism and contractarianism?
"real life is complicated" is a very weak argument. It might suggest that your claim might be true, because hey most anything might be true. But that's hardly enough to raise the probability of your claim.
It doesn't cause an unequal outcome immediately.
Let's say that a butter maximizer is arguing with a guns maximizer but knows that due to power differentials in the negotiation that point B is the likely outcome. The butter maximizer prefers point C' (marked red) over point B due to worries that guns maximizer getting more guns will make future bargaining positions even worse for them.
You might wonder why, if C can't move towards D, why they might be able to move towards C' instead, but real life is complicated. They might find it easier to burn resources to move towards C'. In an ideal world this would merely be part of the above board negotiations, driving the gun maximizer to be more willing to slide towards D, but uncertainty (and the degree to which future actions can be made explicit) might prevent that.
This shows up in real life such as when Obama made the comment that even a tax revenue neutral tax on wall street might be desirable due to "fairness considerations." Colloquially known as 'if I can't have it nobody will.'
Real life negotiations are rarely low dimensional.
But how does knowing about a more efficient *frontier* set of points cause a more unequal outcome point?
Emotional energy is a hard to fake signal about which moral alliances/schelling points we will commit to. Humans are bad actors, so the best way to get game theoretic cooperation is to expend energy in the direction of being the sort of person who gets worked up about the schelling point. Then sunk cost and identity consistency effects help enforce what has been signaled.
People prefer inefficient outcomes if the efficient frontier outcome is sufficiently unequal. This is because they are worried about other agents having even more bargaining power in future tradeoffs. I think this is basically a tribal instinct.
The point is the thrill of gambling, surely? That's a positive experience in itself, even if doesn't result in any financial gain.
What's the point of slot machine winnings if not the future spending they are a predictor of. One can plausibly interpret some sorts of hedonism, including Ben'FB games and drug dealers, in terms of time coordination failure, but not slot machines or financial intermediaries.
I won't claim to understand much about where emotional energy comes from.
Politics is inherently far, inasmuch as a person pursuing his wants would rationally abstain from it. (Voter's paradox, etc.) When functioning in far mode, far objects may be more compelling. Also, as you note in a subsequent posting, "we see things far away in less detail, and draw inferences about them more from top level features and analogies than from internal detail. Yet even though we know less about such things, we are more confident in our inferences!" The greater confidence in far-mode inferences contributes to the ability of far-mode to energize near-mode conation
If far-mode doesn't energize near-mode, then how do you explain the power of the "sacred objects" studied by sociologists or the distance between many voters' politics and their mundane wants?
[On the energization of near-mode by far-mode, see "Cognitive Dissonance: The Glue of the Mind." - http://tinyurl.com/ybclxt42 ]
The fact that wants are more in near mode, and idealism more in far mode, suggests passions are actually stronger about wants. I suspect it is hypocritical morality talk that is in fact the most energized.
Your concern is regarding people doing things that give them small amounts of pleasure in the short term but are a big net cost over their whole lifetime, right? If so, one solution is to note that "you now" and "you in the future" are like two different people, only the former gets to make decisions which can have enormous consequences for the latter without actually consulting them first.
In this model, people blowing their life savings on slot machines looks more like an inability to coordinate across time than a self-destructive but valid single set of preferences.
Moral conflicts energize policy discussions, in the same way that you hope to channel political polarization. (I wonder why you like the former idea but not the latter reality.) If you succeed in stripping facts of their moral interpenetration, few folks will even be interested in betting on your markets.
Unless you have disguised them from yourself, self deception being common, you can be honest but wrong, though honest people usually care about whether they are right rather than be unquestioning, but when your income depends on it..
It sounds like you are saying that people SHOULD want only to be moral, with nothing else added. I'm not disagreeing with that. I'm saying that as a matter of consistent persistent fact, they DO not want only to be moral.