Category: Games
Against family and entourage?
Many individuals travel between countries as part of their professional routines. How do they perform during those short trips abroad? To begin to answer this question, I analyzed the outcomes of over 5 million chess games played around the world. Importantly, tournament chess provides a clean setting in which location-dependent factors are mostly irrelevant; the audiences are quiet and the referees make hardly any judgments. Controlling for differences in chess skills, I found enhanced performance among players who were competing outside of their home countries. This finding was robust to additional controls such as age, sex, and skill momentum or game practice, and to the inclusion of individual or country fixed effects. This advantage, an approximately 2% increase in game outcome, suggests that traveling has a positive effect on performance.
Here is the full paper by Uri Zak, via the excellent Kevin Lewis.
Who are the most rational people?
From John A. Doces and Amy Wolaver:
We examine the question of rationality, replicating two core experiments used to establish that people deviate from the rational actor model. Our analysis extends existing research to a developing country context. Based on our theoretical expectations, we test if respondents make decisions consistent with the rational actor framework. Experimental surveys were administered in Côte d’Ivoire and Ghana, two developing countries in West Africa, focusing on issues of risk aversion and framing. Findings indicate that respondents make decisions more consistent with the rational actor model than has been found in the developed world. Extending our analysis to test if the differences in responses are due to other demographic differences between the African samples and the United States, we replicated these experiments on a nationally representative analysis in the U.S., finding results primarily consistent with the seminal findings of irrationality. In the U.S. and Côte d’Ivoire, highly educated people make decisions that are less consistent with the rational model while low-income respondents make decisions more consistent with the rational model. The degree to which people are irrational thus is contextual, possibly western, and not nearly as universal as has been concluded.
Speculative, and not replicated, but the point remains of definite interest. Via the excellent Kevin Lewis.
A new chess variant
With Steven Brams, an American game theorist, Ismail devised a radical but easily implemented solution to the perceived white bias in chess. Their system, dubbed “balanced alternation”, allows black to make two moves after white’s opening move, with white then taking the next two moves before reverting to standard play.
By giving black a double riposte to white’s opening, Ismail argues that the imbalance would be sharply reduced and “render chess fairer than any other reform of which we are aware”.
…Other players questioned whether chess really needs to be fairer, given the number of draws at elite level. When AlphaZero played itself in last year’s experiment, 98 per cent of the games ended in draws. “More draws? What a bore!” said a leading chess writer.
Ismail acknowledged that the chess world “can be very conservative”. He added: “I do expect a backlash at a proposal like this, but I hope open-minded players will want to give it a try.”
Here is more from The Times of London (gated). You will note that my pet proposal for reforming chess also introduces a kind of color equity, though it is not motivated by that goal. To limit the import of opening preparation and to minimize the number of draws, we should randomize the initial opening moves, but within reason, with an average value clustered around 0.00, and with a focus on non-drawish lines. So some games would start with 1.b4 d5, which is “playable” for White, though few players would move as such in a major tournament. Most of the randomizations shoul be fairly sharp variations, and so the randomization would allow the Petroff and Berlin to surface only one out of every 768 games.
Chess grandmaster markets in everything
But for some players, securing a prestigious title meant more than just playing well. It is an open secret in chess that many players cut side deals with tournament organizers and other top competitors that help them achieve norms they might have struggled to get legitimately.
This culture touched the Momot club. Many of its members acquired their grandmaster credentials in Crimea, at tournaments in places like Sudak and Alushta that were known as “norm factories” — where, for as little as $1,000, organizers would make sure players accumulated enough points for a norm.
But there were other, more subtle, ways to succeed, too. Far from prying eyes, secret agreements and cash exchanges to arrange results were not uncommon, according to interviews with chess players and FIDE officials. In a sport so wholly obsessed with status, title and rank, even selling a game could be accomplished for the right price.
Mikhail Zaitsev, who achieved the rank of International Master and is now a chess coach, estimated that of the world’s roughly 1,900 living grandmasters, at least 10 percent have cheated one way or another to acquire the title. Shohreh Bayat, one of the leading arbiters in chess, describes such arrangements in the plainest terms. “Match fixing,” she said, “is cheating.” Some hopefuls didn’t even have to play a game of chess to get the points they needed: Some tournaments, she said, took place only on paper.
Which media have proven sticky as pandemic has diminished?
The single biggest new media habit to be formed during the pandemic appears to be gaming. The extra hour per week that people spent gaming last year represented the largest percentage increase of any media category. And unlike other lockdown hobbies, it is showing no sign of falling away as life gets back to normal. It has become “a sticky habit”, says Craig Chapple of Sensor Tower. He finds that last year people installed 56.2bn gaming apps, a third more than in 2019 (and three times the rate of increase the previous year). The easing of lockdowns is not denting the habit: the first quarter of 2021 saw more installations than any quarter of 2020. Roblox, a sprawling platform on which people make and share their own basic games, reported that in the first quarter of this year players spent nearly 10bn hours on the platform, nearly twice as much time as they spent in the same period in 2020.
And:
…whereas all other generations of Americans named television and films as their favourite form of home entertainment, Generation Z ranked them last, after video games, music, web browsing and social media.
Here is more from The Economist.
Better Crowdfunding
In 1998, I designed the “dominant assurance contract” (DAC) mechanism for producing public goods privately. In my latest paper, just published in GEB written with the excellent Tim Cason and Robertas Zubrickas we test the theory in the lab and…it works! Kickstarter hadn’t yet been created when I first wrote but the DAC mechanism can now be easily explained as a Kickstarter contract with refund bonuses. On Kickstarter and other crowdfunding sites you contribute to a project and if a contribution threshold isn’t reached you get your money back. The Kickstarter contract is useful but it’s still easy for a good project to fail because there are many equilibria with non-funding. For example, if I think that you won’t contribute then I may decide not to contribute and if I don’t contribute then you may decide not to contribute. Neither of us can do better by contributing, given the other person is not-contributing, and so non-contributing is a Nash equilibrium (see my talk at the Foresight Institute for more details). Now introduce refund bonuses which pay out only if the threshold is not reached. Now if I think that you won’t contribute then I want to contribute, to earn the refund bonus, and the same is true for you. Indeed, the only equilibria in the crowdfunding game with refund bonuses have the project being funded. Thus, a nice feature of the refund bonus game is that in equilibrium the refund bonuses are never paid!
To test the theory we (mostly Tim and Robertas!) created an environment very similar to that faced by people on Kickstarter. Namely, there are multiple projects to choose from, each with different private payouts and each project has a contribution threshold and some projects offer refund bonuses. We test a variety of different types of refund bonuses including fixed (e.g. $10) and proportional e.g. (20% of your contribution) and also early refund bonuses (a refund bonus if the contribution threshold is not reached and you agreed to contribute in the first half of the funding period) or for contributions at any point in the game. Our research leads to three important conclusions.
First, without refund bonuses only ~30% of socially valuable projects succeed (perhaps coincidentally almost the exact same as on Kickstarter). But with refund bonuses the success rate increases by about 50% to 50- 60% and it doesn’t much matter much what type of refund bonuses are used!
Second, early refund bonuses have some useful properties. A key to the mechanism is that it quickly makes many contributors pivotal. At the beginning of the game it’s in no single individual’s interest to fund the public good but as others contribute there comes a time when the contribution necessary to push the total funding over the threshold is less than the value of the public good to the individual–thus, for purely self-interested reasons, a potential contributor can benefit by pushing funding just over the threshold. We say such contributors are pivotal. Early refund bonuses make contributors pivotal sooner and we think this gives people time to recognize that pushing funding over the threshold is in their interest. In addition, when more people contribute early this sends a signal of social cooperativeness which also appears important to fund public goods.
Third, refund bonuses pay for themselves! In theory, refund bonuses are never paid but in practice, as we have seen, some socially valuable projects fail even with refund bonuses. Nevertheless, for reasonable markups it’s still in an entrepreneur’s interest to use refund bonuses because the greater success rate more than pays for having to pay modest refund bonuses when a project fails.
We think refund bonuses can substantially improve crowdfunding and we hope to partner with a crowdfunding site to run a field experiment. Contact me if interested!
Read the whole thing.
Solve for the football culture equilibrium that is Mexican
Many fans shrug off accusations of homophobia and insist the chant is just a joke. “We do not scream at the goalkeeper because of his sexual preference, we don’t even care about it,” a YouTube commenter on a 2016 public-service video denouncing the chant wrote. “We shout to create chaos, because it is part of the atmosphere of a stadium in Mexico.”
For some, the chant merely illustrates wider homophobia in society.
Here is the proposal of an American academic:
“Convince fans that it brings bad luck to their own team,” Doyle said, “and this nonsense will stop.”
Now that’s a plan. The actual (new) rule is to stop play if the chants become too extreme:
Nearly two years ago, FIFA approved a disciplinary code that allows referees to end matches if fans use chants or display behavior deemed to be homophobic or racist. However, because of COVID-19, Mexico’s national team has played few games in front of fans since the rules were adopted.
But when the team returns to the field May 29 to face Iceland in Arlington, Texas, Yon de Luisa, the Mexican federation’s president, said the new code will be strictly enforced.
If you are feeling just a bit generous in interpretation:
There is vigorous debate over whether the chant is offensive since the offending word is said to have many meanings in Spanish, one of which is a derogatory slur used to demean gay men.
Some countries should be just a bit more woke!
Can you call this a new service sector job?
Dave Taube has won a computer, a whitewater rafting trip, and several grills. There’s also the kayak, the powder-blue Coors Light onesie, and the Bruce Springsteen tickets. He recently took home $10,000 from Cost Plus World Market in its “World of Joy” sweepstakes. Recently, he found himself in the running for a trip to Antarctica, which would be the thirty-sixth vacation he’s won. His photo and caption, submitted in response to the prompt, “Tell us what you miss about international travel,” got enough votes to make the top 20. Next, the entries went to judging. In Taube’s photo, he’s slung with cameras and wearing safari duds, half-smiling, with a silver goatee. Strategically, he submitted his caption as a poem to make his entry distinct.
Taube, who is 65 and a decades-long resident of the Pacific Northwest, is a sweeper, a term that distinguishes the committed competitor from the casual, onetime entrant. Each day, he enters about 60 sweepstakes—which are random draws—and contests—which are judged.
And this:
Years ago, he entered a contest for “the most boring person in the Pacific Northwest.” He won a whitewater rafting trip, a plane ride, and a certificate for a tandem parachute jump. He sold the certificate.
He is producing…”contest liquidity”? Publicity? Contest legitimacy? In any case he is paid for his labors, albeit in kind. Here is the full story.
The age of reason is fifth grade?
Finally, the proportion of equilibrium play increases significantly until fifth grade and stabilizes afterward, suggesting that the contribution of age to equilibrium play vanishes early in life.
Here is more from Isabelle Brocas and Juan D. Carrillo, forthcoming in the JPE.
Maradona Plays Minimax
This paper tests the theory of mixed strategy equilibrium using Maradona’s penalty kicks during his lifetime professional career. The results are remarkably consistent with equilibrium play in every respect: (i) Maradona’s scoring probabilities are statistically identical across strategies; (ii) His choices are serially independent. These results show that Maradona’s behavior is consistent with Nash’s predictions, specifically with both implications of von Neumann’s Minimax Theorem.
NFT virtual horse markets in everything
Is it simply that we have made gambling too much fun and too intriguing? Or should we upgrade our view of the welfare consequences of gambling?:
On Zed Run, a digital horse racing platform, several such events take place every hour, seven days a week. Owners pay modest entry fees — usually between $2 and $15 — to run their steeds against others for prize money.
The horses in these online races are NFTs, or “nonfungible tokens,” meaning they exist only as digital assets….
“A breathing NFT is one that has its own unique DNA,” said Roman Tirone, the head of partnerships at Virtually Human, the Australian studio that created Zed Run. “It can breed, has a bloodline, has a life of its own. It races, it has genes it passes on, and it lives on an algorithm so no two horses are the same.” (Yes, owners can breed their NFT horses in Zed Run’s “stud farm.”)
People — most of them crypto enthusiasts — are rushing to snap up the digital horses, which arrive on Zed Run’s site as limited-edition drops; some of them have fetched higher sums than living steeds. One player sold a stable full of digital racehorses for $252,000. Another got $125,000 for a single racehorse. So far, more than 11,000 digital horses have been sold on the platform.
Alex Taub, a tech start-up founder in Miami, has purchased 48 of them. “Most NFTs, you buy them and sell them, and that’s how you make money,” Mr. Taub, 33, said. “With Zed, you can earn money on your NFT by racing or breeding.”
One implication here is that automation is never going to destroy all of the jobs. Here is the full NYT story.
“Free-floating credibility” is underrated
The presence of a minuscule risk for some of the adenovirus platform Covid vaccines means that the FDA has put a hold on J&J and still won’t approve AstraZeneca.
In response to critics, the FDA says that their credibility is on the line. If they allow vaccine use to proceed, and a modest number of people die as a result (with a big increase in net lives saved), the FDA and its defenders claim that people will lose faith in the FDA. Yet that is exactly the wrong thing to say, it is self-serving, and it exacerbates the problem at hand.
When the FDA announces that they have to ban a vaccine because its credibility is on the line, that very announcement puts their credibility on the line. It is a simple two-line proof. Either they are lying about whether their credibility is on the line, in which case they have wrecked their credibility with the lie. Or they are telling the truth, in which case by definition their credibility is indeed on the line.
One lesson is that you should not try to extend your credibility too far, because you will end up unduly constrained.
For purposes of contrast, consider alcoholic beverages. At the federal level they are regulated by the Alcohol and Tobacco Tax and Trade Bureau (who are they again?), and also various state and local authorities.
As a result of this unusual, Prohibition-rooted distribution of authority, alcohol does not come with nutritional labeling.
Now, in that setting, if a bunch of kids die from binge drinking, the credibility of the Bureau is not much damaged. The Bureau does not have to ban alcohol on the grounds that if it does not, the credibility of the Bureau will be ruined. The Bureau simply never put its credibility on the line in this manner.
Now you might favor a tighter regulation of alcohol for some reason, but you could achieve such regulation without tying up the credibility of the ATTT Bureau in knots. Similarly, the Department of Transportation regulates road safety (again with state and local authorities as well), but it has not put its credibility on the line when 40,000 or so Americans die each year on the roads. Again, maybe they should enforce tougher safety standards, but they shouldn’t tie their credibility to getting road deaths down to one hundred, and indeed they do not. They end up with more degrees of regulatory freedom.
Let’s say I were to announce that my credibility as a public intellectual were to depend at how I would fare at darts on British pub night. That would be a big mistake, for multiple reasons. It is like with the FDA. If I am lying about that credibility tie, I hurt my credibility as a public intellectual. If somehow I am telling the truth, well let’s just hope everyone else stays home that evening because my credibility is going to take a beating.
What I call “free-floating credibility” is underrated.
And that is precisely what defenders of the FDA destroy when they…defend the FDA. They make the FDA worse.
NB: You are “out of your lane” commenting on this analysis unless you have studied game theory with Thomas Schelling.
Those new Filipino service sector jobs
In the Philippines, one popular blockchain-based game is even providing pathways out of poverty and helping spread the word about novel technology. Created by Sky Mavis, a Vietnamese startup, Axie Infinity is a decentralized application (dapp) on the Ethereum blockchain where players breed, raise, battle and trade adorable digital critters called Axies.
Ijon Inton, an Axie player from Cabanatuan City, which is about 68 miles north of Manila in the province of Nueva Ecija, first learned about it in February of this year when his friend stumbled across an explainer video on YouTube. Intrigued by the “Play to Earn” element of the game, he decided to give it a go.
“At first I just want to try its legitimacy, and after a week of playing I was amazed with my first income,” said Inton, who is currently earning around 10,000 PHP ($206) per week from playing the game around the clock.
Inton soon invited his family to play, too, and after a few weeks, he also started telling his neighbors. A crypto trader since 2016, Inton helped his friends set up a Coins.ph account so they could buy their first ETH and get started. Now, there are more than 100 people in his local community playing to earn on Axie, including a 66-year-old grandmother.
Here is the full story, via Nicanor Angle. How would you have responded to these sentences a decade ago?:
“We definitely want to get people who are outside of Ethereum, outside of the dapp space, outside of NFTs, into Axie,” Jiho said. He has observed other Axie play-to-earn community clusters in Indonesia and Venezuela, but thinks this might be the first evidence of a multi-generational household of dApp users.
What lies next in store for us?
Ola Malm on the future and industrial organization of chess
It was great to see your “Thursday assorted links” link regarding chess. It has been fascinating to follow the recent online boom to which the game has been subject and to think about what it may mean for the organization, and business, of chess over time.
I speculate, of course, but – as to what the future holds – I believe at least one possible path for the sport runs as follows:
1. The three major chess-focused online platforms (chess.com, lichess, and chess24) reduces to one through a self-reinforcing cycle of greater revenue concentration, the attainment by one party of progressive technical superiority, and the increasing convergence of the chess-playing public on a single provider.
2. The market leader signs exclusivity agreements (governing non-FIDE play) with a significant portion of top players and becomes the de-facto organizer of most commercially significant tournaments. In contrast to (1), this could conceivably happen quite quickly, as it involves only a limited set of individuals.
3. The centralization of elite-level play on a single platform enables that platform’s Elo rating to emerge as the chess world’s most important manifestation of achievement, thus furthering the leading provider’s competitive position (and affording it, through subscription fees, the financial means of accelerating (1) and of maintaining (2)).
4. FIDE’s tight grip on the sport is somewhat loosened, and the organization reverts to being something more akin to what it used to be and was originally intended to be – a (gentler) gentlemen’s club (in the English, rather than the American-English, sense of the term) focused on advancing the sport of chess.
Step (2) is, to a certain extent, already underway in the form of Nakamura’s link with chess.com and Carlsen’s ownership interest in Play Magnus (which owns chess24 and hosts the Champions Chess Tour). Attempting to negotiate individual agreements with single players would very likely turn out no easier than herding cats (and a rather resourceful and independent sort of cat, at that); rather, I believe whichever party may seek to implement a form of player exclusivity would find it easier to, on a unilateral basis, simply issue rating-based cash compensation (in exchange for promises of exclusivity) to the top-10-ranked (or top-50-ranked – the precise number is of course unimportant) Grandmasters. To rate players, the provider could adopt the current FIDE ranking as its starting position, but thereafter “fork” it (much like an open-source piece of code is forked) and base future rankings (for payment purposes) exclusively on play on its own platform (to enable (3)).
Some would no doubt scoff at such a development as unwelcome commercialization. And, yet, I think it would constitute a step, if not indisputably forward, certainly not backward, for chess. International sports tend to be organized in one of two ways: through one-nation-one-vote Swiss associations (such as soccer’s FIFA); or through commercial corporations (such Formula1’s Liberty Media). Time has undeniably imbued governing bodies in the former category with a certain cachet, but it has also made many of them inefficient and corrupt, as their governance systems – designed for a pre-WWI European world of volunteerism and gentlemanly conduct – have failed to adapt to, and to ward off, an extent of contemporary cynicism. If the Guardian is to be believed, FIDE has not been entirely spared: https://www.theguardian.com/sport/2016/jun/03/chess-rights-multimillionaire-model-agency-owner-david-kaplan; https://www.theguardian.com/sport/2016/jun/03/chess-fide-president-offshore-firms-rights-kirsan-ilyumzhinov. I think most sports, including chess, would be no worse managed – in the sense of attracting both a broad player base as well as a vibrant elite tier – were they to convalesce around corporate organizations rather than Swiss associations.
I am pleased to report that Ola was an earlier Emergent Ventures recipient.
Be Like Mommy and Daddy: Markets in Everything
Get it here.