How Can Markets Help Policy Deliberation?


I just discovered DARPA’s Policy Analysis Market project. The idea has me wondering what the place is for market based deliberations solutions, and when it’s appropriate to give actors a self-incentive that isn’t already inherent to a situation.

There’s a strong argument to be made for the predictive power of markets, and their stabilizing incentive structures, but their application beyond economics hasn’t really been worked out yet. Some examples of market-like political models include Fantasy Congress, and National Journal’s Political Stock Exchange.

When success isn’t able to be neatly defined as profit (as in financial markets), and when motivators and strategies are as complex as they are in a legislature, sometimes, paradoxically, it’s profitable to operate at a loss. Indeed, one could suggest that all non-profits are the pure form of incentives being isolated from broader incentive structures.

(hat tip to this tweet from "hytmal"; my initial response is here)

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