Comment by lambdaphagy on Real-Life Examples of Prediction Systems Interfering with the Real World (Predict-O-Matic Problems) · 2021-03-14T00:53:56.734Z · LW · GW

In particular, I’d appreciate more examples of prediction systems making the world more predictable.

 

There is a possibly apocryphal anecdote about how, prior to the publication of the Black-Scholes model, option prices approximately reflected theory.  After the publication of the model, option prices precisely reflected theory because everyone was using the model to price options!

I have never been able to find a source for this story but it should be easy enough to verify through historical options data.

 

EDIT: I apparently failed to read as far as the first comment: https://www.lesswrong.com/posts/6bSjRezJDxR2omHKE/real-life-examples-of-prediction-systems-interfering-with?commentId=2kKZ87cQxmMviyJmc