Ask HN: What can markets compute?

https://news.ycombinator.com/item?id=4643268

by ecmendenhall • 14 years ago

3 3 14 years ago

news.ycombinator.com

Markets generate efficient solutions to enormously complex allocation and optimization problems by aggregating distributed information and sending price signals. What else can they compute? What are their computational properties? Are market systems Turing-complete or universal in some other sense? What is the most interesting research on this subject?

001sky2• 14 years ago

Markets generate efficient solutions to enormously complex allocation and optimization

(1) The use of 'efficient' by economists is 'naive'

(2) Markets spit out data, nothing else

(3) They don't speak, you revise your priors

If these points make sense to you, they might be interesting lines of inquiry. If not, you might want to look back on this later.

[Edit: This assumes a solid technical understanding, so where you are in your understanding (academic/practical), and what your purpose is for your inquiry, will determine how ambitious you can be. Probably understood, but for the avoidance of doubt, worth stating nevertheless.]

ecmendenhall• 14 years ago

Technical understanding always determines ambition!

You've given me two excellent answers in the last few weeks. (The other was on Aristotle, inter-subjective selection, and N-dimensional optimization). Thank you!

001sky2• 14 years ago

Markets leave abstract traces of best-efforts solutions to enormously complex allocation and optimization solved by hierarchies

-- For extra credit, reconcile this with your initial premise.

Ask HN: What can markets compute?

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