Brain storm: What is the theory behind a good political mechanism?

Is there somewhere where ideas like this are discussed intelligently?

I'm not aware of a single central hub for such discussion I'm afraid. There's academic work in the area of development economics which looks at countries around the world and tries to identify what traits of governmental institutions seem to correspond with economic growth and prosperity. This is where Paul Romer and his charter cities idea is coming from.

If you want some really out there but intelligent discussion of related ideas you might want to check out Unqualified Reservations. Maybe start with the gentle introduction series. Mencius Moldbug could be described as many things but concise is not one of them so you're looking at a fair bit of reading there.

Arnold Kling blogs on this topic a bit as well, he has a particular interest in the idea of 'unbundling' government services.

If the experiments in governance are atheoretical, then I'd expect most of them to be worse. Just as most random mutations in a complex organism are likely to be worse.

Think of competitive government as a meta-theory of political mechanisms in the same way a well functioning market economy represents a meta-theory of producing efficient organizations rather than a theory of how to run an efficient organization. The question is how to structure things in a way that there is an incentive for good governance. If you get the incentive structure right then good governance will tend to outcompete bad governance. The individual experiments would not be atheoretical but the structure under which they operate is intended to be agnostic about what the best approach will prove to be.

Many of the people you'll see talking about competitive government are libertarian leaning and so would have their own personal ideas about how to run a government but rather than privileging their own pet theories they want to put them to the test against other ideas about how to run things. A Thousand Nations emphasizes that traditional ideological opponents could in theory both get behind the idea of competitive government as it would give them the opportunity to go and test out their own utopian ideals without having to convince anyone else.

Experimentation has a cost, what is the expected benefit from experimenting with different forms of government. How is that expected benefit justified?

I don't see how this is any different in principle from the question of the value of experimentation and innovation in general. Many technologies ultimately prove to be market failures but I think the evidence is pretty compelling that economies that follow a free market model and 'waste' resources on ideas that don't pan out have a better track record of producing net benefits through innovation than economies that attempt to centrally plan innovation.

I just find it disheartening when people don't want to try applying their brains to the problem of at least narrowing down the space of how governments should be designed.

I don't believe advocates of competitive government are generally doing this. They just don't believe that their own ideas should be given special privileges over everyone else's.

Is there somewhere where ideas like this are discussed intelligently?

Hmm... Actually in most places, the host will be slightly biased towards their own ideas and will not really be engaging in discussing new ideas. In Matt's endorsement of unqualified reservations, he's suggesting a blog where the host almost never replies back to comments, but it is well written reactionary stuff.

I just find it disheartening when people don't want to try applying their brains to the problem of at least narrowing down the space of how governments should be designed.

I guess that until competitive government becomes really feasible in a mass scale, this thought is very theoritical. Quite rationally, people want to cross the bridge when they come to it.

About the actual design, it's like Eliezer explained when people asked him about how he did his AI box thingy, there is no substitute for thinking hard. You really have to think about incentives of every person in every role in the whole structure.

Mencius short circuits this by assuming a corporate structure and says that since it works well enough in the real world, it would work in a sovereign structure also. This is a good argument from the outside view. Simple hierarchy is definitely a solution to Goodhart's law as I had mentioned in my post, but as Robin Hanson had pointed out in his comment, it feels like a cop-out.

Control of smaller organisations than governments, e.g. charities.

Organization and management of businesses and nonprofits is, if not exactly a well-understood problem, then at least the subject of a large body of expertise, and more importantly, of constant real-life tests in the marketplace. If there existed a way to reach useful insight there by theorizing from first principles, I would guess that someone would have already found it (and used it to great practical success).

Seasteading

Setting aside the questions about the practical viability of seasteading, it can be viewed as a special case of colonizing an uninhabited territory. While this may seem as an opportunity to design institutions from scratch, in reality it's naive to ignore the culture that the colonists will bring with them, and the constraints this imposes on the way the colony's institutions can work. As de Maistre wrote, "Sovereigns command effectively and in a lasting way only within the circle of things acknowledged by opinion, and they are not the ones who trace the circle of opinion." How would your abstract model capture that?

If the political systems were seen to be better in these smaller situations, they might very slowly move into the larger states (probably multi-century timescales).

Even a casual glance at the history of the last two centuries shows that transplanting political institutions from one culture to another doesn't work in practice. Attempts to do so occasionally work by sheer luck, but more often fail miserably, and it's not at all rare to see them blow up spectacularly.

There are other ways of engaging in micronational secessionism. The best method prehaps is to unilaterally declare independence under the Montevideo Convention on the Rights and Duties of States, but do so in such a matter as to not attract the attention of the federal government (for example, keep on paying taxes, follow the laws). Then begin operating as if you are an independent government. Examples would include the Republic of Molossia and the Empire of Atlantium. You will lose status though.

The main problem is thinking you could generalize from one small situation into the macrolevel. There may be intervening variables that could explain why a government can succeed with small population and that same government collaspe when it runs a large population.

At least in continental Europe we didn't switch to democracy in the sense that we created a system that's supposed to sum up all individual interests and turn them into public policy.

Neither in theory nor in practice.

The UK never really switched away from being a monarchy but is some form of hybrid. I haven't read the founding fathers of the US, so I'm not totally sure about what they wanted. They however created institutions like the supreme court that are at odds with the desire to have the sum of individual interests guide public policy.

If so how would you evaluate it theoretically?

Does the public policy follow the public interest (volonté générale)? Timeless decision theory helps with the details.

And monarchies are not just the absolute rule of a single person. That was a odious feature of them though.

Before Louis XIV there were monarchies that weren't about the absolute rule of a single person. Local princes held quite a lot of power. Today you have a bunch of small minority groups who reside in Washington who have quite a lot of political power without being formally elected.