Re: Social Policy Bonds -- Attn: Robin Hanson

Date: Mon Jan 22 2001 - 10:57:20 MST said:
> I don't think you understand my concern yet. [...]
> Thus the only way do-gooder buyers can make a net profit is by tending
> to buy more bonds in this initial auction when their private info says
> they expect to do good, and fewer bonds when their private info says
> otherwise.

Okay, let me try to understand. Are you assuming that the do-gooders
aren't changing their behavior depending on how much of the bonds they buy?
 I'm explicitly assuming that at least some of the potential do-gooders
will be incented to do good by having bought low-priced bonds with the
ability to make the claim come true. If everyone is only betting on the
action from the sidelines, I would agree that it's hard for do-gooders to
make a difference by investing. They make a difference by choosing a
market to invenst in in which they can change the outcome.


Chris Hibbert         It is easy to turn an aquarium into fish soup, but    not so easy to turn fish soup back into an aquarium.
                        -- Lech Walesa on reverting to a market economy.

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