Simulacrum 3 As Stag-Hunt Strategy

Interestingly, i think the current coordination around the GameStop short squeeze can be explained with this framework.

If WallStreetBets tried to do this coordination with the goal of making money, they would probably fail. but this is not the stated goal. for many, the goal is one of entertainment, sticking it to the man, or other goals that are unrelated to making money. many even say they don't care if they lose money on this because it's not the point.

So in a way, they're pretending to value the stock, and they're coordinating to pretend.

I think the benefits in this case from having a non-monetary goal is that it changes the incentive structure. if the goal was to make money, then there would be much more incentive to defect and not everyone would be able to win. if the point is to bankrupt those who shorted these companies (or some other non-monetary goal), then everyone can "win" (even if they lose money) and it's easier to coordinate.

I don't know if it goes all the way to level 3, but i still find this an interesting connection.

I've been drawing more connections the more I think about this.

Here's one: belief-in-belief [LW · GW]. Humans seem hard-wired to sometimes believe that they believe things different from their aliefs (i.e. their "real" beliefs as implied by their actions). Why? The usual answer is handwave politics handwave machiavellian intelligence hypothesis handwave. But what are the actual concrete mechanisms by which humans are able to gain by being good at "politics" in this particular way? What exactly are these "politics", what is the form of the game, how do "politics" have such large evolutionary rewards?

One possible answer is that belief-in-belief evolved to solve coordination games, via exactly the sort of strategy in this post.

Example: a group is organizing a lion hunt, and the tribe's shaman blesses them with lion-protection. They don't want to actually believe that they're magically protected against lions; that would imply terrible tactics like "casually stroll in and pick a one-on-one fight with a lion". Nor do they want to pretend to believe to be magically protected; that would at-best trick other members of the tribe into thinking they're magically protected against lions, which would just mean other tribe-members get slaughtered by bad tactics. (Yes, evolution is usually happy when competitors die, but in this case I'm assuming that humans in a larger tribe have higher reproductive fitness than in a smaller tribe or alone.) What the hunters really want is to pretend-to-pretend to be protected from lions (so everyone goes on the hunt), while also acting like they are not protected (e.g. for tactical purposes).

If the goal is to pretend-to-pretend, without actually believing or pretending to actually believe, then belief-in-belief is the ideal tool.

I like this as an explanation for babblers, people who stumble on simulacrum level 3 but are clueless and thus are totally disconnected from the original reasons for all these necessary coordination points. They've never seen a stag or rabbit but know that saying "stag!" emphatically to people gets agreement. This happens intergenerationally as parents forget to alert their children to the actual reasons for things. Having observed this happen with millenials, I am scared of what we are all collectively missing because older generations literally just forgot to tell us.

This reminded me of a summary of the job of real estate developers by Scott Alexander:

I started the book with the question: what exactly do real estate developers do? ... Why don’t you or I take out a $100 million loan from a bank, hire a company to build a $100 million skyscraper, and then rent it out for somewhat more than $100 million and become rich?

As best I can tell, the developer’s job is coordination. This often means blatant lies. The usual process goes like this: the bank would be happy to lend you the money as long as you have guaranteed renters. The renters would be happy to sign up as long as you show them a design. The architect would be happy to design the building as long as you tell them what the government’s allowing. The government would be happy to give you your permit as long as you have a construction company lined up. And the construction company would be happy to sign on with you as long as you have the money from the bank in your pocket. Or some kind of complicated multi-step catch-22 like that. The solution – or at least Trump’s solution – is to tell everybody that all the other players have agreed and the deal is completely done except for their signature. The trick is to lie to the right people in the right order, so that by the time somebody checks to see whether they’ve been conned, you actually do have the signatures you told them that you had.

Now I wonder whether it is actually "blatant lies" or more like the pretend to pretend to develop the real estate. 

I think that all of ethics works like this: we pretend to be more altruistic / intrinsically pro-social than we actually are, even to ourselves [LW · GW]. And then there are situations like battle of the sexes, where we negotiate the Nash equilibrium while pretending it is a debate about something objective that we call "morality".

This gave a satisfying "click" of how the Simulacra and Staghunt concepts fit together. 

Things I would consider changing:

1. Lion Parable. In the comments, John expands on this post with a parable about lion-hunters who believe in "magical protection against lions." That parable is actually what I normally think of when I think of this post, and I was sad to learn it wasn't actually in the post. I'd add it in, maybe as the opening example.

2. Do we actually need the word "simulacrum 3"? Something on my mind since last year's review is "how much work are the words "simulacra" doing for us? I feel vaguely like I learned something from Simulacra Levels and their Interactions [LW · GW], but the concept still feels overly complicated as a dependency to explain new concepts. If I read this post in the wild without having spent awhile grokking Simulacra I think I'd find it pretty confusing.

But, meanwhile, the original sequences talked about "belief in belief [LW · GW]". I think that's still a required dependency here, but, a) Belief in Belief is a shorter post, and I think b) I think this post + the literal words "belief in belief" helps grok the concept in the first place.

On the flipside, I think the Simulacra concept does help point towards an overall worldview about what's going on in society, in a gnarlier way than belief-in-belief communicates. I'm confused here.

Important Context

A background thing in my mind whenever I read one of these coordination posts is an older John post: From Personal to Prison Gangs [LW · GW]. We've got Belief-in-Belief/Simulacra3 as Stag Hunt strategies. Cool. They still involve... like, falsehoods and confusion and self-deception. Surely we shouldn't have to rely on that?

My hope is yes, someday. But I don't know how to reliably do it at scale yet. I want to just quote the end of the prison gangs piece:

Of course, all of these examples share one critical positive feature: they scale. That’s the whole reason things changed in the first place - we needed systems which could scale up beyond personal relationships and reputation.

This brings us to the takeaway: what should you do if you want to change these things? Perhaps you want a society with less credentialism, regulation, stereotyping, tribalism, etc. Maybe you like some of these things but not others. Regardless, surely there’s something somewhere on that list you’re less than happy about.

The first takeaway is that these are not primarily political issues. The changes were driven by technology and economics, which created a broader social graph with fewer repeated interactions. Political action is unlikely to reverse any of these changes; the equilibrium has shifted, and any policy change would be fighting gravity. Even if employers were outlawed from making hiring decisions based on college degree, they’d find some work-around which amounted to the same thing. Even if the entire federal register disappeared overnight, de-facto industry regulatory bodies would pop up. And so forth.

So if we want to e.g. reduce regulation, we should first focus on the underlying socioeconomic problem: fewer interactions. A world of Amazon and Walmart, where every consumer faces decisions between a million different products, is inevitably a world where consumers do not know producers very well. There’s just too many products and companies to keep track of the reputation of each. To reduce regulation, first focus on solving that problem, scalably. Think amazon reviews - it’s an imperfect system, but it’s far more flexible and efficient than formal regulation, and it scales.

Now for the real problem: online reviews are literally the only example I could come up with where technology offers a way to scale-up reputation-based systems, and maybe someday roll back centralized control structures or group identities. How can we solve these sorts of problems more generally? Please comment if you have ideas.

Most of the writing on simulacrum levels have left me feeling less able to reason about them, that they are too evil to contemplate. This post engaged with them as one fact in the world among many, which was already an improvement. I've found myself referring to this idea several times over the last two years, and it left me more alert to looking for other explanations in this class. 

Thanks, this is a fantastic post. it takes a problem in game theory, shows an unusual way of solving it the real world, shows an example of it, and then explains away the added complexity and demonstrating that it all adds up to normality [? · GW] by showing that it doesn't require the actors to understand that this is what they're doing - thus giving a full Gears-Level [? · GW] understanding of the issue. strongly upvoted.

As a society, we've actually codified some of these ideas in advice idioms like "fake it till you make it". We've also codified the equal and opposite advice, e.g. "you can fool all the people some of the time and some of the people all the time, but you cannot fool all the people all the time".

This means we can not only engage in this kind of coordination behavior without understanding the mechanism, we have generalized the coordination mechanism to apply across domains such that no deeper understanding is needed, i.e. you don't even need to notice that the strategy works, only have adopted a norm that you're already applying in multiple domains that allows you to coordinate without realizing it.

So: we make our case for Stag, try to convince people it’s the obviously-correct choice no matter what. And… they’re not fooled. But they all pretend to be fooled. And they all look around at each other, see everyone else also pretending to be fooled, and deduce that everyone else will therefore choose Stag. And if everyone else is choosing Stag… well then, Stag actually is the obvious choice. Just like that, Stag becomes the new Schelling point.

This seems like it could be easier for certain kinds of people than for others. One might want to insist to the group that yes, I know that Stag isn't always right, that's silly, and before you know it, you've shattered any hope of reaching Stag-Schelling via this method.

I haven't seen a strong argument that "stag hunt" is a good model for reality. If you need seven people to hunt stag the answer isn't to have seven totally committed people, who never get ill, have other things to do, or just don't feel like it. I'd rather have ten people who who are 90% committed, and be ready to switch to rabbit the few days when only six show up.

Curated. I appreciated the tying together of two different frameworks, and some articulation of what Simulacrum level 3 is about.

I actually found this particularly valuable in light of the Yoav's GameStop comment [LW(p) · GW(p)].

In particular, we should expect this sort of thing in industries with increasing marginal returns on investment.

My model of Zvi doesn't think this is a precondition at all (for moral maze development, at least).

I think this is because management is always involved in a stag hunt of one sort or another, regardless of whether the industry overall is stag-hunty, because producing anything is a delicate coordination problem.

A great explanation of something I've felt, but not been able to articulate. Connecting the ideas of Stag-Hunt, Coordination problems, and simulacrum levels is a great insight that has paid dividends as an explanatory tool. 

This seems like a good description of what late stage communism looked like in Poland. Everyone knew that communism was rubbish, the best anticommunist jokes came from party members, but "ambitious" people kept on professing how much they believed in how well it worked and how much they were helping the poor oppressed workers, since that was the way to advance. 

A additional bonus is that those on other simulacrum levels are actively selected against - honestly believing in communism would result in you getting shunned, as you're then playing a different game.