Does Money Ruin Everything?
Imagine someone said:
The problem with paying people to make shoes is that then they get all focused on the money instead of the shoes. People who make shoes just because they honestly love making shoes, and who aren’t paid anything at all, make better shoes. Once money gets involved people lie about how good their shoes are, and about which shoes they like how much. But without money involved, everyone is nice and honest and efficient. That’s the problem with capitalism; money ruins everything.
Pretty sad argument, right? Now read Tyler Cowen on betting:
This episode is a good example of what is wrong with betting on ideas. Betting tends to lock people into positions, gets them rooting for one outcome over another, it makes the denouement of the bet about the relative status of the people in question, and it produces a celebratory mindset in the victor. That lowers the quality of dialogue and also introspection, just as political campaigns lower the quality of various ideas — too much emphasis on the candidates and the competition. Bryan, in his post, reaffirms his core intuition that labor markets usually return to normal pretty quickly, at least in the United States. But if you scrutinize the above diagram, as well as the lackluster wage data, that is exactly the premise he should be questioning. (more)
Sure, relative to ideal people who only discuss and think about topics with a full focus on and respect for the truth and their disputants, what could be the advantage of bets? Money will only distract them from studying truth, right?
But just because people don’t bet doesn’t mean they don’t have plenty of other non-truth-oriented incentives and interests. They are often rooting for positions, and celebrating some truths over others, due to these other interests. Bet incentives are at least roughly oriented toward speaking truth; the other incentives, not so much. Don’t let the fictional best be the enemy of the feasible-now good. For real people with all their warts, bets promote truth. But for saints, yeah, maybe not so much.