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Negative reputations

I think Nick is basically right in his analysis.   But I think the
situation is even worse than he describes.  

Consider a specific context in which a person faces the choice of whom
to deal with.  Some of the choices will be more local nyms and some
will be more global nyms.  Global nyms allow you to find out lots of
other things about them, because they have been used in many other
contexts.  Local nyms have few associations.

As Nick describes, one will be reluctant to deal with a local nym
unless it has engaged in many other similar interactions - otherwise
one might fear it is trying to escape negative credentials.  

Moreover, if the interaction is not simple and structured, so that one
there are a wide variety of possible ways in which one might hope
this relationship will flower, then local nyms, with associations
offered only regarding some simple structured interaction, will be
even less attractive.  Sure this nym assures me it won't take my cash,
but what if I was also hoping we might become friends?  Global nyms
offer more ways to guess about these other possibilities.

It seems to me there is also a serious adverse selection problem here.
If most people use global nyms for most informal social and unstructured
business contacts, then the fact that someone has chosen a local nym
for some interaction may signal something to you about them.  If there
is some subpopulation of "bad" contacts who prefer local nyms to avoid
negative reputations, then the rest of us may choose global nyms to
signal that we are not a bad contact.  This can be the equilibrium
even if all of us would prefer a world with more local nyms.

This process may in fact encourage much more global nyms than we have
now, by encouraging people to publicly post information about
themselves which in the past would have been difficult to find out
about someone.  If most people post all their grade school
class-troublemaker records on the web, and you don't, maybe people
will take that to imply you were a troublemaker in grade school.  

Of course they won't care if they are contemplating a simple
structured interaction which you have done many times before, like
sell them some ice cream.  But if they are contemplating a long term
close business relationship, or inviting you to a party or an closed
mailing list, they may well care.  

I don't think crypto fans realize just how high the cards are stacked
against them on creating a world of where most interactions are via
local nyms.  

Robin D. Hanson  hanson@hss.caltech.edu  http://hss.caltech.edu/~hanson/