Автор: Анкап-тян

My friend has watched too many streams by some guy from California and is now rooting for antitrust authorities. How do I explain to him that antitrust authorities only do harm?

анонимный вопрос

Yeah. Here, as with discussions about socialism, it is important not to get bogged down in details. You tell a person about Venezuela, and they reply that it’s the wrong kind of socialism, and that it’s under sanctions anyway. The same goes for antitrust cases: you explain that after the forced breakup of Standard Oil, oil prices only rose, and they will cite a bunch of additional factors or simply say it was an isolated incident. You talk about the pointlessness of the Russian FAS, and they’ll say that everything in Russia is messed up, but in decent countries, it’s a different story.

It seems to me that it would be far more productive to provide a general understanding of the factors influencing a firm’s size and its operating strategy.

Let’s consider a certain company. It buys some product on the market, uses it to produce another product, and sells this new product. What the input product is doesn’t really matter. It could be raw materials, semi-finished products, human labor, technology, and so on. What the output product is also doesn’t really matter; it could even be the same product as the input, just moved to a different point in space, preserved in time, or repackaged into different containers.

A company can change in size, and this changes the efficiency of its activities (that is, income relative to investment). There are factors that lead to an increase in efficiency as a company grows larger. For example, a transportation company can afford to use higher-capacity vehicles, where the costs per unit of weight are significantly lower. And there are factors that lead to a decrease in efficiency as a company grows. For example, the expansion of a boutique chain beyond wealthy neighborhoods results in peripheral outlets bringing in less money.

As sales markets expand and progress is made in the organization of business processes, there are more and more niches in the world where large companies are most efficient. Moreover, it may turn out that a certain market simply cannot accommodate more than one or two companies, and attempting to prevent their growth or breaking up existing ones will lead to a drop in efficiency and, accordingly, a flight of capital to more profitable industries. Thus, an external regulator will only oppress the industry by increasing production costs, which may lead to price increases or savings on quality—exactly the opposite of the regulator’s goal.

At the same time, as I already detailed for the case with Microsoft specifically, even if a company dominates a certain market, under conditions of free competition, it still cannot relax and earn superprofits from monopoly rent, so nothing threatens the consumer.

At the same time, there are factors that hinder the growth of companies, so monsters formed through unsuccessful mergers and acquisitions lose efficiency and, after a while, begin to rid themselves of unnecessary parts if they do not want to go bankrupt; so here too, the presence of antitrust authorities is completely redundant.

Finally, there are state corporations for whose management the efficiency of the corporation’s operation is not important at all; what matters is the size of their personal income, which is most easily increased with substantial turnover. Therefore, state corporations will tend to expand regardless of market conditions, but this is exactly where antitrust authorities are powerless, as they are themselves precisely the same part of the state.

So, no matter how you look at it, antitrust authorities provide no benefit to either business or consumers; there is only benefit for the wallets of those who have direct influence over these bodies or access to insider information about their work.

I don’t know why the image of a fish stuck so much to this phenomenon, but now those involved in the M&A industry mock it as much as they can

Why are Russian “libertarians” for the most part blinkered youngsters who live in their imagination, without projecting their views onto modern realities?

dad

In many ways, we live in a space of realized utopias.
First, people dream of something, while others find it incredible, ridiculous, and unrealizable, and then before they know it, it is already in full bloom.

And this applies not only to science and technology, but also to the sphere of human relations. So, confidently and argumentatively asserting certain behavioral patterns as something that should be is a quite viable method of changing existence.

But as people grow up, they adopt and develop more and more heuristics for living in the real world, which quite logically conflict with the previously formed image of a dream. At any moment, a person can break and declare that they have become a realist, and now all these dreams no longer interest them at all. So, narrow-mindedness helps to preserve a dream longer, or at least to have fewer costs for its preservation.

I know only one working way to preserve faith in ideals in older people. You need to show them how much has already been traveled on the road toward it, show them that they are not walking alone, show the immediate prospects that are quite realistic to implement, and show that the distant prospects are, in general, quite attainable. A dream alone will not achieve results; one will still have to move in small steps.

And as for old libertarians, there simply aren’t enough of them yet in our Russian society.

Sorry, that turned out pretentious. But it’s okay, sometimes one can afford it.

Narrow-minded youth is an ancient phenomenon

How will private property rights to mobile communication frequencies be determined under anarcho-capitalism, and can they even be property from a libertarian perspective?

анонимный вопрос

I will start with the second part of the question. Of course, technically nothing prevents competing companies from placing a huge number of cell towers side by side that operate in the same frequency range, but this would lead to collisions, and the equipment would be unable to perform its primary purpose—providing mobile communication. Therefore, it can be confidently stated that the working frequency range for mobile communication is a scarce resource. And anything that is a scarce resource can be converted into property.

Now let’s move to the question of determining property rights for this peculiar object in the absence of an external regulator. There are only three permissible ways of acquiring property without violating libertarian principles: primary appropriation, purchase, and compensation for damages. It remains to understand the specifics of applying these methods to frequencies.

Technical characteristics of using frequencies for mobile communication (I am simplifying greatly, after all, this is a post about economics, not technology):
1. There is a specific frequency range for which equipment is manufactured. This range is optimal for mobile communication based on radio wave propagation characteristics: on the one hand, the phone antenna can be quite compact; on the other, waves do not attenuate too strongly in the environment and allow for sufficiently reliable reception indoors, shielded from the signal source by walls.
2. Using the entire frequency band within which mobile devices operate allows for the simultaneous transmission of a certain finite amount of information. The wider the frequency range used by a particular mobile operator, the wider the communication channel they can provide to their users, and consequently, the more users they can connect. More accurately, the less frequently they need to place towers to serve their users.
3. In addition to mobile operators, other companies may use the same frequency ranges for their own needs.

So, a certain mobile operator wants to enter a region. They estimate the tower density they minimally need at the start, depending on the population density in different parts of the region, infrastructure (communication is desirable along main highways, even if few people live there for some reason), and so on. Another parameter in determining tower density turns out to be the width of the frequency range the operator will use.

If there is no particular competition for frequencies, then there is no problem. The operator takes a large unused band and begins to exploit it. Gradually, competitors arrive, and this continues until the free ranges are exhausted. What should operators do now? First, they can abandon the idea of entering a region with such high competition and expand where competition is lower, but this is not always convenient, as subscribers want communication from their operator in all regions to avoid dealing with roaming. Second, they can buy a range from someone who is using it. Since the early adopters grabbed frequencies with a large margin, operators may initially agree to such offers at reasonable prices. Third, they can agree on the joint use of existing frequencies and equipment, which reduces costs for each party to the agreement. Such a precedent, by the way, occurred in Russia during the construction of fourth-generation networks: for them to work productively in densely populated areas, frequency bands must be quite wide and continuous, and so operators began to conclude agreements on the joint use of their ranges. The funniest part is that they had to obtain permission from the state for this, although, it would seem, what business is it of theirs.

Finally, a fourth possible tactic for an outsider is to ignore agreements and simply start placing their own towers and seizing frequencies on a first-come, first-served basis. As in, whether you like it or not, I am now also working on this frequency, and if you don’t like it—move. This is a declaration of war, which eventually ends in one agreement or another. War is a very ruinous enterprise that also damages one’s reputation. Judge for yourself: if subscribers of an existing operator begin to experience connection problems and the operator explains to them that this is because an outsider has arrived and is sticking in their towers, the outsider will have to offer simply revolutionary low tariffs for users to feel even a semblance of loyalty toward them. I do not rule out that occasionally such a seizure of frequencies will be economically justified, but far more often (ancap provides all the tools for this), the delusional will simply go bankrupt.

A characteristic intermediate stage of the industry’s extensive development: everyone has their own tower, but they all stand side by side. At the stage of cost reduction, we will see all these toys on one Christmas tree.

Ancap-chan and Friends

Friends, I would be glad if you joined my telegram chat. I set it up literally last night; at the time of writing this post, there are about fifty people there, and so far I really like the atmosphere.

What is the chat for? I would like to discuss fresh posts from the channel there, ask for your opinion on the project’s development, and answer any short questions about libertarianism — but if a question requires a detailed answer, then it can be asked on the website, as before. Of course, I have nothing against chat participants discussing libertarianism without my involvement; my opinion is just one voice in a general intellectual discussion.

What else would I like to see in the chat? I want to set a standard of respectful communication. We have a subject of conversation: libertarianism in all its aspects. Settling personal disputes or public declarations of personal attitudes toward third parties is not interesting. There are many wonderful platforms for arguing, but they are outside of my chat. I wouldn’t want to silence anyone, so moderation will be as unobtrusive as possible. I might entrust it to another chat participant, but only if I have strong reasons to assume that it will not disrupt the existing atmosphere of trust.

See you in the chat!

Love you all!

Continuation of the discussion about reputation

Bitarch replies:

You wrote a review of my reputation proposal, but it seems you didn’t understand the exact essence of the idea. You write:

As for the system you proposed, people will be willing to take its recommendations into account only if, for some reason, it becomes very important to them that a person, for the sake of increasing their reputation, be willing to contribute to charity.

The main goal of the system is not to show one’s generosity to others, but to create a mechanism for the value of a reputational entity, which will then be a pity to lose. Game theory comes into play, making deceiving other people economically disadvantageous. The original idea was proposed by the developers of the OpenBazaar project; I modified it for application in real society.

Reputation Pledges
OpenBazaar implements proof-of-burn in a different way. On the OpenBazaar network, users can choose to be pseudonymous, meaning you don’t know their true identity. As such, it can sometimes be difficult to determine if they are trustworthy or should be avoided. A reputation system is important to help inform the network of which participants have acted honestly in the past, and which haven’t. There are several facets to the OpenBazaar reputation system, which is still being built, and you can read about the overall system here. One part of this system is Reputation Pledges. This means that a user has chosen to prove their commitment to their OpenBazaar identity by burning a certain amount of bitcoin. The act of burning coins shows the network that the user is committed to their identity because they’ve now expended resources on it, and if they incur a negative reputation then those resources will have gone to waste.


https://openbazaar.org/blog/proof-of-burn-and-reputation-pledges

Indeed, that’s roughly how reputation works. “No one remembers McFlurry the bridge builder! But once I fucked a goat…”

Thank you for the clarification that charity in the proposed engine is not that important, the main thing is the willingness itself to confirm one’s reliability through the expenditure of resources. This could indeed prove important for an outsider to gain traction on a particular trading platform. They could spend money on advertising, or instead, or in addition, spend it on boosting their karma, and this would also perfectly demonstrate their willingness to play fair.

But I thought it important to note that it is pointless to try and stretch any such mechanisms to fit all cases in life. A person can be honest and respectable, like Alexei Karenin, but his wife will still throw herself under a train because in her eyes, he is an inhuman machine.

— I don’t understand why you hate me so much? What have I done wrong to you?
— Fuck a goat, Onegin!

Reputation under ancap, part 2

Yesterday I published a model of a reputation engine for ancap that was submitted to me for review, and today I will tell you what I think about it

I will start, as usual, with a definition. Reputation is the conclusion drawn by a potential counterparty regarding a certain subject and the prospects of interacting with them, based on the full extent of their knowledge about that subject. Thus, reputation is not a property of the subject. My reputation in the eyes of socialism-chan and my reputation in the eyes of minarchism-chan are two completely different reputations, and the difference between them is no less than the difference between the concepts of “execution” and “a fine”.

Many have heard about the Chinese social credit system. The state collects a vast amount of the most diverse data about a citizen, then using an incredibly complex and opaque algorithm, it puts two and two together and concludes how reliable this citizen appears to be to the state. The higher the rating, the more freedoms it is willing to grant the citizen; the lower it is, the more it restricts them. The goal of this entire system is social engineering—the cultivation of the perfect human of the future. I don’t know if market offers for “boosting” ratings have appeared yet, but if not, they simply must appear soon.

Everyone knows about the Russian Unified State Exam (USE) system. The state forces schoolchildren to take a test of monstrous proportions, and then forces universities to admit applicants based on a single criterion: the result of this test. I don’t need to tell you what phenomenal results are demonstrated in this test by natives of certain national republics.

Examples can be multiplied, but I think it is already clear that the forceful imposition of one’s own assessments of someone’s reputation on others is not the true Tao. It’s not even about the fact that such systems will be attempted to be cheated, but about the coercion itself. In ancap, however, any system that collects certain data about people and derives assessments from it can be implemented only if people voluntarily begin to use that system.

How do I envision a near-ideal reputation system? Something like this:
— Siri, look at the proposal from Bitarch; can this guy be trusted?
— I have performed an express analysis of the proposal itself and what is available about Bitarch in open sources. Based on your previous preferences, Ancap-sama, the probability that you will trust him is 85%. The probability that he will betray your trust should cooperation begin is 7%. You specified a trust threshold of 80%; may I respond to him affirmatively, or would you like to review the details?
— Give me the details.
— Hi!

Of course, just as people try to get the maximum score on the USE or the maximum social rating in China, they will want to optimize their requests for the reputation assessment system I use—in this example, Siri. But they will strive to earn my trust in the same way now, when a lot of data has to be collected manually.

The more routine I want to remove from my life, the more typical decisions will be entrusted to my virtual consigliere. But first, one way or another, I will have to train this neural network on my preferences; otherwise, the result is unlikely to consistently please me.

Siri, scratch my back, please!

As for the system you proposed, people will be willing to take its recommendations into account only if it somehow becomes very important to them that a person, for the sake of increasing their reputation, be willing to contribute to charity. I doubt such a quality would concern me if, for example, I am looking for a one-night stand or choosing a model of hiking boots. But if I need to find a home for a litter of homeless kittens, then that’s a different story.

Reputation under ancap

Bitarch (topic disclosure paid in the amount of 0.005btc)

Today I have an unusual format. In essence, this is not about answering a question, but a review of a full, detailed proposal. Therefore, I would like to split the topic into two posts. Today’s post will outline the proposal itself, and in tomorrow’s, I would like to provide a detailed overview of the topic of reputation and the construction of reputation systems. Discussion in the comments is highly welcome.

As we all understand, under ancap, the institution of reputation will play a significant role. Imagine that a person is not yet well-known in the community or wants to atone for their past “sins” by creating or restoring a reputation. There is an organization or a blockchain project to which this person can make a donation and receive in return an ID with reputation points. They can show this to other people when conducting transactions to increase trust. If they cheat, the victim can file a complaint with this system, and the fraudster will lose the reputation points for which they previously made a donation (more precisely, their ID with negative reviews will be useless for concluding deals in the future). To exclude fraud on the part of the victim, the reputation service may also require them to make a donation of a similar amount (and they will also make their own reputation ID useless if they lie and are caught). The result is a reputation system in which it is not profitable for the parties to deceive each other from the perspective of game theory. The donations received can be directed toward funding public goods (schools, hospitals, roads, science, ecology, etc.), simultaneously finally dismantling the main argument of statists against libertarians: “If a person has no insurance and no friends, who will take care of them in old age, provide medical treatment, free education for children, and so on?”.

How do you evaluate this system?

How and to whom to sell libertarianism?

анонимный вопрос

Libertarianism can be sold to everyone, but, of course, in different ways.

The simplest and most obvious approach is to sell it to those who are already ready to buy, they just don’t know it yet. That is, simply explaining to spontaneous libertarians that they are indeed libertarians, and why their worldview is not something terrible or selfish, and that they shouldn’t be ashamed of it; in short, buddy, you’re not a faggot, you’re gay, and that sounds proud. In principle, this is what I do. I wait for a question, I answer it. Then others, having heard such a question, refer to my ready-made answers, or may even simply say, “look at Ancap-chan, there was probably something on this topic.” Although, if we develop the market metaphor, I have less of a sale as such, and more like after-sales support.

The most important thing to convey to such buyers is the benefit of identifying themselves as an open libertarian. For some, it will be relevant to gain coherent notions of the theory, and thereby systematize their understanding of the world, which they can then apply to any life situation themselves. For some, it is more important to feel among like-minded people. For some, feelings are not enough, and they are set on joint activity. Talking about the merits of a product to an attentive, interested client is easy and pleasant; it is enough to have confident knowledge of the product.

It is harder to sell libertarianism to those who generally have an active life position, a sense of justice and self-worth, but whose theoretical background conflicts with libertarianism. For these people, materials like conditional “secular lectures” and five-minute briefs, as well as other educational videos, work well as a start. Then come specific questions, which can lead to explanations of any level of detail. It’s not a fact that you’ll manage to sell your product, but you will leave the client with the impression that the product is generally not bad, and that libertarians themselves are decent people and it is perfectly fine to deal with them. Thus, social democrats, social liberals, ancoms, all sorts of gender activists, ecologists, and whoever else are gradually drawn into our orbit.

It is impossible to fully sell libertarianism to those who are beneficiaries of the current regime, realize it, openly admit it, and approve of this order of things. “I served on a submarine, now at 35 I’m retired, and you want to deprive me of both money and the realization of my moral superiority—fuck off.” To such people, one can only subtly drop individual theses in areas that do not conflict with their platform. For example, the aforementioned submariner can perfectly well absorb the libertarian approach to weapons.

And it is completely useless now to sell libertarianism to those who, under any regime, will approve of the status quo out of considerations like “just in case something happens,” “we’ve never lived rich, no point in starting now,” and so on. As long as Kiselev is on the first channel, they are deaf to our arguments, and when we end up there, they will take our side simply because the bosses know best. The most that can be done regarding them now is to stay in their sight, to loom somewhere on the edge of their consciousness. So that when reforms begin, Praskovya Ilyinishna remembers that she heard something about us, and explains it to Pelageya Kuzminishna herself: “don’t be scared, they aren’t Bolsheviks, they’re libertarians, they’re peaceful, they’re for being able to trade sunflower seeds without patents.” And she would reply: “ah, libertarians! Being old, I thought I heard ‘proletarians.’ Well, if they’re libertarians, then alright.”

these are not pensioners, these are proud entrepreneurs