So one description of this situation is that what a habitual gambler is paying for is the gambling itself rather than its outcome; that is, what the gambler derives utility from is the act of gambling. In that sense there’s no money-pumping involved: the gambler is just paying for a service he strongly desires.
You can always redefine pumping as non-pumping by saying that the victim derives utility from being pumped.
And this is why you can’t (necessarily) distinguish a preference from a bias with behavioral studies alone, which should weaken our faith in the results of the heuristics and biases research program (at least, slightly).
In the money pump, the agent isn’t extracting the surplus from the cycle, because they trade everything they get back at some point and end up with strictly less than they started with, including intangibles.
If this is a strict requirement of a money pump, (and I can see the argument for it), it seems like the bases for human intransitive preferences don’t qualify as intransitive if ephemeral / insubstantial gains are treated as concrete cases of surplus.
In fact, if it is a strict requirement, it seems like the money pump is a fairly useless model unless agents literally had “hard-coded” exogenous intransitive preferences, which doesn’t seem to make it much of a practical worry in AI, either.
The presence or absence of an ephemeral/insubstantial gain in a given transaction is a fact independent of any other transaction. Rational agents with well-ordered values that consider insubstantial benefits not easily viewable to an outside observer could engage in behavior where they traded money for insubstantial benefits in a manner that looked exactly like a money pump to an outside observer. They would also seek ways to acquire those insubstantial benefits in ways that cost less.
Really, though, convincing someone that you have an intangible benefit that they want enough to pay for is simply good marketing.
One description of an archetypal money-pumping situation (where an agent prefers A to B, and B to A, and keeps swapping one for the other with another agent, to whom he pays commission) is that the first agent derives utility from the act of obtaining either A or B in exchange for its counterpart, and he’s paying for that service.
If utilitarianism is to make sense as a model, you can’t question someone’s utility. If money-pumping is to be a meaningful description of a possible scenario, it has to be structural, not just a narrative that can be ascribed to an agent’s preferences.
I don’t think what I’ve written applies to arbitrary money-pumping. An agent with incoherent preferences doesn’t have a utility function.
RichardKennaway models a habitual gambler as having incoherent preferences because the gambler prefers money to not having money but prefers taking negative-EV (in terms of money) bets to taking no bets. I model a habitual gambler as having a utility function which includes a term for money but which includes a second term for, I dunno, “excitement,” and a negative-EV (in terms of money) bet has positive expected utility for such a gambler because of the gain in excitement. I think this is a more accurate model, and I also don’t think habitual gambling is in isolation evidence of incoherent preferences. (I’m not claiming that humans have coherent preferences, though.)
RichardKennaway models a habitual gambler as having incoherent preferences because the gambler prefers money to not having money but prefers taking negative-EV (in terms of money) bets to taking no bets. I model a habitual gambler as having a utility function which includes a term for money but which includes a second term for, I dunno, “excitement,” and a negative-EV (in terms of money) bet has positive expected utility for such a gambler because of the gain in excitement. I think this is a more accurate model, and I also don’t think habitual gambling is in isolation evidence of incoherent preferences. (I’m not claiming that humans have coherent preferences, though.)
Yes. I’m bothered when people criticize gambling on the ground that it’s negative EV in terms of money, given that (say) going to the cinema is also negative EV in terms of money but few people criticize that on that ground. (I guess that what’s going on is that those people enjoy going to the cinema but don’t enjoy gambling, and don’t realize other people may be different.)
That’s just the metaphorical reptilian brain winning the fight for control of the gambler’s body over the metaphorical neocortex. There is a nice bit of fictional evidence about it in the movie Flight, when Nicole, a drug addict, dials her dealer while simultaneously praying for him not to answer the phone. The winner is not money-pumped, but is rendered the requested service.
Sure it does. The utility theory metaphor for the human agent is simply wrong in lots of cases. The human agent isn’t a single agent but a plurality. The study of how pluralities allocate resources and interact is economics / game theory / voting theory, not utility theory per se.
Sure it does. The utility theory metaphor for the human agent is simply wrong in lots of cases. The human agent isn’t a single agent but a plurality.
That doesn’t help. Suppose we have two people, one with a preference for A over B, one with a preference for B over A. If they start out with various amounts of A and B, and trade, trade will eventually stop with a distribution of A and B that no trade can improve on. No money pumping is possible.
Money-pumping through non-transitive preferences can only happen if the preferences exist within the same person. You can talk about sub-agents of a person if you like, but they are not parts of the same person in the way that two people are parts of the same society. Even if we consider those two people fighting over A and B instead of trading, this still does not correspond to what happens within a conflicted individual. In extremis, one actual person can kill the other; the gambler sliding into ruin injures all of himself. Many who suffer from an addiction might wish to cut out and destroy the unwanted motivation, or lock it in jail, or any of the other things that can be done with undesirable people, but this is not currently possible.
The utility theory metaphor for the human agent is simply wrong in lots of cases.
I would say it is a description, not a metaphor, but I agree it is simply wrong in lots of cases. Utility functions define transitive preferences only. An agent with non-transitive preferences does not have a utility function and is not described by utility theory.
You can talk about sub-agents of a person if you like, but they are not parts of the same person in the way that
two people are parts of the same society.
Even if we consider those two people fighting over A and B instead of trading, this still does not correspond
to what happens within a conflicted individual.
Does it make sense to talk about the USA as if it were an agent that could get money pumped? An Obama administration is very different from a Bush Jr. administration.
I think one analogy here is that the human “agent” is ran by powerful executives that rapidly get voted out of office. To the extent that voting models what’s going on inside human heads, negative results on voting also apply..
Does it make sense to talk about the USA as if it were an agent
In some contexts, yes, in others, no. And at best it’s an approximation.
that could get money-pumped?
In everyday language, this is called “playing off one side against the other”.
I think one analogy here is that the human “agent” is ran by powerful executives that rapidly get voted out of office. To the extent that voting models what’s going on inside human heads, negative results on voting also apply..
I agree! My claim is game theory / economics / voting theory are complicated, but well-developed and informative models for human preferences. If they are wrong (as all models are..) they are wrong for more subtle reasons than utility theory. On LW people spend far too much time thinking/talking about utility theory and preferences vs these alternatives. Discourse will improve if more mindshare is moved to better models.
I’ve never liked that slogan, not even with the completion “but some are useful”. Of course, statistics is the science of how to make the best of bad data, and if bad data is all you can get, statistics is what you do. But “all models are wrong” strikes me as furnishing an easy excuse for intellectual laziness.
Rain causes mud; mud does not cause rain. Is that a “wrong model”? Matter is made of atoms; atoms are made of electrons, protons, and neutrons. Is that a “wrong model”? The structure of DNA—a “wrong model”? Of course, if you search assiduously enough you can spy out faults in any assertion anyone makes, but to say that these are wrong in the way that a piece of statistical curve-fitting is “wrong” is, to borrow Isaac Asimov’s quip, wronger than both of them put together.
If I visit my doctor with an illness, what I really want is for the actual disease process to be known, and an intervention that is known to actually fix the problem, in the same way that a car mechanic can find out what is wrong with a car and fix it by understanding what needs to be done and why. True models, that is. In the current state of the art in medicine, there aren’t very many. “All models are false” is a counsel of despair.
Perhaps Box was only talking about statistical models. But we aren’t.
But “all models are wrong” strikes me as furnishing an easy excuse for intellectual laziness.
Ok.
My point (I think we were talking about utilities), is that phenomena well known here on LW such as observed lack of transitive preferences, akrasia, precommitments, and so on, can be usefully viewed via a plurality model of human agency. It’s fine if you don’t like this model, but then you should like the utility function model even less (as its even less realistic).
People like my mother (who occasionally go to the casino with $40 in their pocket, betting it all in 5-cent slot machines a nickel at a time, then taking back whatever she gets back) go to the casino in order to have fun/relax, and playing casino games is an enjoyable past time to them. Thus while they lose money, they acknowledge that it is more likely than not that it will happen, and are not distressed when they leave with less money than they enter with because their goal was to enjoy themselves, not to end up with more money—getting more money is just a side benefit, something that happens sometimes (about one time in four that she goes, she winds up with more money than she entered with) but which is not really the primary purpose.
Ergo calling it a money pump in such cases is a bit silly.
On the other hand, people who genuinely believe they can win money at the lottery/gambling (against the house; it is not irrational to play poker or blackjack with the idea that you can win, IF you know what you’re doing) are in fact engaging in money pumping activities.
But it really depends on the nature of the person involved as to whether or not it is a true money pump.
On the other hand, people who genuinely believe they can win money at the lottery/gambling (against the house; it is not irrational to play poker or blackjack with the idea that you can win, IF you know what you’re doing) are in fact engaging in money pumping activities.
The only people who I know that do this, do it due to beliefs about their own capability of pre-cognition, not due to incoherent beliefs. There was a non-mistaken variation where someone reverse engineered the PRNG in the slot machines to win.
On the other hand, people who genuinely believe they can win money at the lottery/gambling (against the house; it is not irrational to play poker or blackjack with the idea that you can win, IF you know what you’re doing) are in fact engaging in money pumping activities.
That doesn’t strike me as money pumping so much as having false beliefs.
When I go into the pinball arcade, I would prefer to have more money than less (all other things being equal), but will still put $20 value-signifier of metal into machines in order to have fun.
I happen to have more fun playing pinball than playing casino games, but the principle is the same.
This doesn’t seem like money pumping to me. A money pump, as I understand it, means that you exchange money for A. Then you exchange A+money for B. Then you exchange money+B for A. Habitual gamblers just exchange money for the chance to win more money. The gamble that they take is never taken back by the casino.
It took me about five minutes to get there, but I’m actually kind of convinced by this example, and really surprised I didn’t think of it since I have a massive dislike of institutionalised gambling.
Compulsive shoppers, yes. Ordinary people, no. Ordinary people simply prefer the goods they are buying over the money they are paying. They do not immediately sell the goods at a loss and then repeat the cycle. Preferring A to B does not create a money pump. Preferring A to B and B to A, that is a money pump.
Casinos. The habitual gambler would prefer to have money than not, and would prefer to take the negative-value bet than not.
So one description of this situation is that what a habitual gambler is paying for is the gambling itself rather than its outcome; that is, what the gambler derives utility from is the act of gambling. In that sense there’s no money-pumping involved: the gambler is just paying for a service he strongly desires.
You can always redefine pumping as non-pumping by saying that the victim derives utility from being pumped.
And this is why you can’t (necessarily) distinguish a preference from a bias with behavioral studies alone, which should weaken our faith in the results of the heuristics and biases research program (at least, slightly).
Then you aren’t modeling the pumping properly; the agent is getting something out of the cycle.
Any money-pumped agent is getting surplus from each transaction. That’s why they’re carrying out the transaction.
In the money pump, the agent isn’t extracting the surplus from the cycle, because they trade everything they get back at some point and end up with strictly less than they started with, including intangibles.
If this is a strict requirement of a money pump, (and I can see the argument for it), it seems like the bases for human intransitive preferences don’t qualify as intransitive if ephemeral / insubstantial gains are treated as concrete cases of surplus.
In fact, if it is a strict requirement, it seems like the money pump is a fairly useless model unless agents literally had “hard-coded” exogenous intransitive preferences, which doesn’t seem to make it much of a practical worry in AI, either.
The presence or absence of an ephemeral/insubstantial gain in a given transaction is a fact independent of any other transaction. Rational agents with well-ordered values that consider insubstantial benefits not easily viewable to an outside observer could engage in behavior where they traded money for insubstantial benefits in a manner that looked exactly like a money pump to an outside observer. They would also seek ways to acquire those insubstantial benefits in ways that cost less.
Really, though, convincing someone that you have an intangible benefit that they want enough to pay for is simply good marketing.
I’ve heard that for badly addicted gamblers, what they want is the trance. Getting a jackpot is an unpleasant distraction.
One description of an archetypal money-pumping situation (where an agent prefers A to B, and B to A, and keeps swapping one for the other with another agent, to whom he pays commission) is that the first agent derives utility from the act of obtaining either A or B in exchange for its counterpart, and he’s paying for that service.
If utilitarianism is to make sense as a model, you can’t question someone’s utility. If money-pumping is to be a meaningful description of a possible scenario, it has to be structural, not just a narrative that can be ascribed to an agent’s preferences.
I don’t think what I’ve written applies to arbitrary money-pumping. An agent with incoherent preferences doesn’t have a utility function.
RichardKennaway models a habitual gambler as having incoherent preferences because the gambler prefers money to not having money but prefers taking negative-EV (in terms of money) bets to taking no bets. I model a habitual gambler as having a utility function which includes a term for money but which includes a second term for, I dunno, “excitement,” and a negative-EV (in terms of money) bet has positive expected utility for such a gambler because of the gain in excitement. I think this is a more accurate model, and I also don’t think habitual gambling is in isolation evidence of incoherent preferences. (I’m not claiming that humans have coherent preferences, though.)
Yes. I’m bothered when people criticize gambling on the ground that it’s negative EV in terms of money, given that (say) going to the cinema is also negative EV in terms of money but few people criticize that on that ground. (I guess that what’s going on is that those people enjoy going to the cinema but don’t enjoy gambling, and don’t realize other people may be different.)
That doesn’t account for the gamblers who want to quit but can’t.
That’s just the metaphorical reptilian brain winning the fight for control of the gambler’s body over the metaphorical neocortex. There is a nice bit of fictional evidence about it in the movie Flight, when Nicole, a drug addict, dials her dealer while simultaneously praying for him not to answer the phone. The winner is not money-pumped, but is rendered the requested service.
Looking at the two halves of the circle separately does not make the circle go away.
Sure it does. The utility theory metaphor for the human agent is simply wrong in lots of cases. The human agent isn’t a single agent but a plurality. The study of how pluralities allocate resources and interact is economics / game theory / voting theory, not utility theory per se.
That doesn’t help. Suppose we have two people, one with a preference for A over B, one with a preference for B over A. If they start out with various amounts of A and B, and trade, trade will eventually stop with a distribution of A and B that no trade can improve on. No money pumping is possible.
Money-pumping through non-transitive preferences can only happen if the preferences exist within the same person. You can talk about sub-agents of a person if you like, but they are not parts of the same person in the way that two people are parts of the same society. Even if we consider those two people fighting over A and B instead of trading, this still does not correspond to what happens within a conflicted individual. In extremis, one actual person can kill the other; the gambler sliding into ruin injures all of himself. Many who suffer from an addiction might wish to cut out and destroy the unwanted motivation, or lock it in jail, or any of the other things that can be done with undesirable people, but this is not currently possible.
I would say it is a description, not a metaphor, but I agree it is simply wrong in lots of cases. Utility functions define transitive preferences only. An agent with non-transitive preferences does not have a utility function and is not described by utility theory.
Does it make sense to talk about the USA as if it were an agent that could get money pumped? An Obama administration is very different from a Bush Jr. administration.
I think one analogy here is that the human “agent” is ran by powerful executives that rapidly get voted out of office. To the extent that voting models what’s going on inside human heads, negative results on voting also apply..
In some contexts, yes, in others, no. And at best it’s an approximation.
In everyday language, this is called “playing off one side against the other”.
I put little value on these analogies and metaphors of people as collectives. They may be better than the idea of a mind as being a single thing without parts, but unlearning a falsehood does not mean that you now know the truth.
I agree! My claim is game theory / economics / voting theory are complicated, but well-developed and informative models for human preferences. If they are wrong (as all models are..) they are wrong for more subtle reasons than utility theory. On LW people spend far too much time thinking/talking about utility theory and preferences vs these alternatives. Discourse will improve if more mindshare is moved to better models.
I’ve never liked that slogan, not even with the completion “but some are useful”. Of course, statistics is the science of how to make the best of bad data, and if bad data is all you can get, statistics is what you do. But “all models are wrong” strikes me as furnishing an easy excuse for intellectual laziness.
Rain causes mud; mud does not cause rain. Is that a “wrong model”? Matter is made of atoms; atoms are made of electrons, protons, and neutrons. Is that a “wrong model”? The structure of DNA—a “wrong model”? Of course, if you search assiduously enough you can spy out faults in any assertion anyone makes, but to say that these are wrong in the way that a piece of statistical curve-fitting is “wrong” is, to borrow Isaac Asimov’s quip, wronger than both of them put together.
If I visit my doctor with an illness, what I really want is for the actual disease process to be known, and an intervention that is known to actually fix the problem, in the same way that a car mechanic can find out what is wrong with a car and fix it by understanding what needs to be done and why. True models, that is. In the current state of the art in medicine, there aren’t very many. “All models are false” is a counsel of despair.
Perhaps Box was only talking about statistical models. But we aren’t.
Ok.
My point (I think we were talking about utilities), is that phenomena well known here on LW such as observed lack of transitive preferences, akrasia, precommitments, and so on, can be usefully viewed via a plurality model of human agency. It’s fine if you don’t like this model, but then you should like the utility function model even less (as its even less realistic).
I certainly do.
That’s addiction. It’s not addiction to losing money, it’s addiction to playing the games.
Arising from non-transitive preferences.
Source? Addictions don’t always or even typically arise or result in non-transitive preferences.
People like my mother (who occasionally go to the casino with $40 in their pocket, betting it all in 5-cent slot machines a nickel at a time, then taking back whatever she gets back) go to the casino in order to have fun/relax, and playing casino games is an enjoyable past time to them. Thus while they lose money, they acknowledge that it is more likely than not that it will happen, and are not distressed when they leave with less money than they enter with because their goal was to enjoy themselves, not to end up with more money—getting more money is just a side benefit, something that happens sometimes (about one time in four that she goes, she winds up with more money than she entered with) but which is not really the primary purpose.
Ergo calling it a money pump in such cases is a bit silly.
On the other hand, people who genuinely believe they can win money at the lottery/gambling (against the house; it is not irrational to play poker or blackjack with the idea that you can win, IF you know what you’re doing) are in fact engaging in money pumping activities.
But it really depends on the nature of the person involved as to whether or not it is a true money pump.
The only people who I know that do this, do it due to beliefs about their own capability of pre-cognition, not due to incoherent beliefs. There was a non-mistaken variation where someone reverse engineered the PRNG in the slot machines to win.
That doesn’t strike me as money pumping so much as having false beliefs.
Have casinos ever tried to sell “gambler’s insurance” that pays out some amount of money if you lose too much at the casino?
The only example I know are the government bailouts.
When I go into the pinball arcade, I would prefer to have more money than less (all other things being equal), but will still put $20 value-signifier of metal into machines in order to have fun.
I happen to have more fun playing pinball than playing casino games, but the principle is the same.
This doesn’t seem like money pumping to me. A money pump, as I understand it, means that you exchange money for A. Then you exchange A+money for B. Then you exchange money+B for A. Habitual gamblers just exchange money for the chance to win more money. The gamble that they take is never taken back by the casino.
It took me about five minutes to get there, but I’m actually kind of convinced by this example, and really surprised I didn’t think of it since I have a massive dislike of institutionalised gambling.
Shops. The habitual buyer would prefer to have money than not, and would prefer to purchase goods than not.
Compulsive shoppers, yes. Ordinary people, no. Ordinary people simply prefer the goods they are buying over the money they are paying. They do not immediately sell the goods at a loss and then repeat the cycle. Preferring A to B does not create a money pump. Preferring A to B and B to A, that is a money pump.
Precisely my point.