Expected Value Reconstituted as Game Theory Equilibria

[Anonymous No.9567939]

Hey Friends,

This is stuck in my head now. I thought this model was just a neat way to get a much better Prediction Market. If you like Economics and Game Theory, the idea is simple, and I doubt it is original, but it is profound, and I have no idea why this isn't talked about all the time.

In Game Theory and Economics, generally we assume either Expected Value is happening or will tend to happen. We can redefine Expected Value as when Outcomes and Payouts are aligned: Outcome Payout Equilibrium. More or less, we just set up conditions that cause markets to want to reach this equilibrium. It is surprisingly harder than one would expect. Expected Value is in every pricing equation, but just trying to get markets to create it seems hard and rare.

Read this, including all comments if you are interested. Basically, this is a real market that can exist, and it is the closest market to Expected Value that can exist, and reaching Outcome Payout Equilibrium should be relatively rare.

Note for the uninitiated that we aren't trying to get markets to perfectly predict the future. This is just looking at market equilibria: times when the payouts to market predicted outcomes are inline when the prediction is made.

https://steemit.com/sports/@roosterred/a-new-type-of-prediction-market-roosterred-s-prediction-is-payoff-pip-markets

[Anonymous No.9567951]

(((economics)))
(((market)))

[Anonymous No.9567986]

>>9567951
What is the point of this? What if I am a jew? Is a jew trying to convince you other jews' maths are more doubtful than you thought? What would be the point? You already don't trust jews, apparently.

The tl;dr is that every expected value term in every pricing equation could have a much larger error than previously thought, which quickly spirals out of control if you are familiar with statistics.

[Anonymous No.9567990]

>>9567939
I can assure you know one here understands or cares.

[Anonymous No.9567992]

>>9567990
urite

[Anonymous No.9568021]

>>9567939
>Today we are going to look at a fantastic new model for prediction markets.
I ceased reading at precisely this point.

[Anonymous No.9568026]

>>9568021
Then you aren't familiar with prediction markets. They are start with a+b=1. PIP markets force the markets a and b to try to equal 1. That is it. We are making markets try to make expected value. I don't know why this is new, but all the prediction markets currently existing either don't do this or obscure it under layers of bullshit.

[Anonymous No.9568046]

>I think I will be rewriting this article. But I now realize that this equilibrium--let's call it Outcome Payout Equilibrium--is a lot more interesting on its own. It is just forcing the market to attempt to create Expected Value instead of assuming Expected Value should or will eventually hold. I am sure this isn't an original idea, but I don't know why it isn't talked about. I just saw it as a solution to create a prediction market with the correct payouts that bewilderingly was not being used. The trouble for this very simple market to find equilibrium (fund/find Expected Value) is disconcerting to me.