I am a member of a hard-left party and have been that for about a decade. I will drop communism the instant you show me the solution to this puzzle: There are two people and one thing, a potential buyer A and the thing's current owner and potential seller B. Both prefer to keep as much money to themselves as possible, all else equal. Construct a trade algorithm that takes as input information from these two people, A telling it the maximum amount he is willing to pay, B telling it the minimum price he would be willing to sell it for. The algorithm has to meet the following properties:

1. The trade happens if the amount stated by A is equal to or higher than the amount stated by B.
2. If the trade happens, the amount of money changing hands is within the overlapping range of these two statements.
3. There is no third party deducting from the amount of money going from A to B or adding to it.
4. There is no incentive for either A or B to tell the program a dishonest amount.

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this sounds like a loaded question.

How stupid are you, son? Have you never read Marxian economic theory? Abstract individual commodity trade has no determinate value, it is whatever people agree to trade.

...

What else do you want? He's wrong from the get go. He posits an abstract economy of TWO people, a condition in which nothing but abstract petty commodity trade can be conceived, no SNLT, no competition, no capital, nothing. This cannot exist in reality nor even makes sense in theory.

what are "friends", Alex. I'll take "not an argument" for 300.

???

if priceA>=priceB{
return (PriceA-PriceB)/2 + PriceB
}
else{
return null;
}

This code conforms to your 4 criteria. Not sure why you think this would be complicated?

?
It's a math/logic puzzle.

Counter-example: A's honest max bid is \$ 20, B's honest min selling price is \$ 10. With honest information, that rule the following result:
The trade happens (so far so good). The algorithm spits out the price \$ 15, which looks like a good compromise. This meets requirements 1, 2, 3.
Meaning that among potential situations where the object is traded, the buyer wants the situation where the price is as low as possible. Remember requirement 4:
Suppose A downplays how much he truly would be willing to pay at max (\$ 20) and states his max bid at \$ 12. Then the algorithm spits out that trade happens at \$ 11. There is incentive for the potential buyer to state a lower amount than his true willingness to pay.

Likewise, if A is an honest fellow and B has a rough idea how much A values that thing, B can benefit from exaggeration.

that rule returns the following result I meant -_-;

Those are pretty silly posts.
Do you also write answers like that when doing a math test? "I refuse to answer this geometry question. Real objects have imperfections. Perfect cubes do not exist, you platonist crypto-fascist!"
I assume by SNLT you mean socially necessary labor time. Things that have no labor time whatsoever entering their production do exist, since things that aren't produced by humans do exist. And whether we like it or not, in current society pieces of nature are privately owned and traded.

I award you zero points.

The answer to the question is that such an algorithm is impossible to construct. A follow-up question is what approximate formulas exist, e.g. criteria 2, 3, 4 are satisfied, but trade only happens with some probability, what is that probability? Or: 1, 2, 4 are satisfied, can the deduction/subsidy be limited to a certain amount?

Method which satisfies 2, 3, 4, but only a weaker version of the first demand: There is an Agency C that recommends a price, and trade only happens when A>=C>=B, at the price set by C.

Method which satisfies 1, 2, and 4, kinda: Trade happens when A>=B, A pays an amount equal to B's minimum selling price, and there is a subsidy added to it so B receives an amount equal to A's maximum. The reason I wrote kinda: This is only strategy-free for A and B acting as individuals, if they collude A can make the subsidy going to B fantastically big.

Can this be combined with the version with the agency to get something sensible?

Replying to myself again. It doesn't seem that the method with the price-suggesting agency and the method with the subsidy can be combined into something useful. A trivial combination of the two methods doesn't work. That is, suppose we take the agency price as the binding price if A>=C>=B and otherwise go with the subsidy method, that breaks the strategy-freeness that either component has when being the sole method.

Example: Suppose with honest inputs the pattern is A>C>B, with the values 7, 5, 3, respectively. So the price paid is 5. If the potential buyer dishonestly states a value of 4, he pays only 3 instead of 5. Likewise, if the situation differs from the honest one in that it's the potential seller who is dishonest by stating a value of 6, he gets 7 instead of 5. (Of course, there is some limit to how much potential buyer and seller can game the system. If both make these dishonest statements, the trade doesn't happen.)

Man, I should have posted this to /liberty/ instead, winning over hundreds of people to the cause of anarcho-hoxhaism.

Is there a method that satisfies 1, 3, 4?

The first three are easy. They just pick a value half-way between the two points and trade at that value.

The hard part is discouraging dishonesty. It might be possible to use something like the en.wikipedia.org/wiki/Elitzur–Vaidman_bomb_tester to exploit quantum mechanics in order to semi-destructively test for dishonesty through quantum torture.

Yes, in this case you throw requirement 4 out the window and it turns from a math/logic problem into a sociological issue of whether or not people lie to get more benefit for them.

Dont say its a puzzle when its not a puzzle but more of a social issue than a math/logic puzzle.

Im not a market socialist though. The trick to using markets to your advantage in socialism is to not allow this kind of interaction to occur. These interactions presume a subjective theory of value (which we all know is false). Imo, you should use a simulated market so you can remove the profit incentive of the selling party and the buying party either has the choice to buy or not buy, but no option to bargain.

But to come back to your revised question, you are basically asking us to create a lie detector, which is not within the realm of our reach yet. My first solution still conforms to the original 4 requirements. If you meant #4 differently you should have worded it better. Maybe you meant:
But right now, the first 2 are actually requirements while 3 and 4 are formulated as given conditions. This is because you use "There is x" rather than "The must not be".

Honesty is not treated as a given . The puzzle says:
and then lists the four requirements.
There are already two anti-lie methods mentioned in this thread, one where dishonesty doesn't pay in general and one where dishonesty doesn't pay unless A and B conspire together.
Stop right there, revisionist -_-

Have you not heard about my special snowflake simulated market yet?

Despite your convoluted and poorly worded question I will humor you.

Since the OP did not define the "thing" I will define it as T. The OP also does not mention anyone else in this scenario so we must assume that the entire universe/environment within which this puzzle takes place consists solely of the two people (A and B), the Thing (T), and an undefined amount of money possessed by each person which we will represent as n ( n= 0>n>1).

For the purposes of this puzzle a successful trade will be defined as G1. Since the OP further failed to stipulate any reason for the trade to take place in the first place we need to take a few liberties to provide a mechanism that drives trade. Otherwise…
There is literally no reason for A to initiate a trade because T is not given any value by the OP's parameters. As such without any variable adding value to T (thus creating incentive to trade) B can never create an offer for T that A will accept because the interaction will always (with the exception of negative value offers which would not logically make sense) result in a loss for A and a gain for B. To solve this dilemma we must introduce a value variable to T which we will define as V.

From here things are pretty straight forward.

G1= A(1-n*T(A'V)) (=)or(>) B(1-n*T(B'V))

This satisfies all requirements as given by the parameters set by OP.

Essentially because the OP words his question to imply that only money has 'value' as demonstrated by the statement "Both prefer to keep as much money to themselves as possible, all else equal" the trade cannot take place unless 'value' is also arbitrarily given to the commodity as well.

As a tangent this is essentially the philosophical difference between Communism and Capitalism. The debate over who gets to decide what value is given to T. In my algorithm A and B must each define their own value for T and adjust the amount they are willing to offer accordingly. Communists however would reason that the value of T can and indeed must be defined by an outside arbitrator which being unable to account for A and B's own personal valuation of T, could never be reasonably expected to make the trade interaction work except by force, leaving either A or B unsatisfied as one of them would usually feel they were being given a bad deal because they would have their own valuation of T.

There is nothing ambiguous about the original puzzle as stated.
You just wrote zero is bigger than n and n is bigger than 1.

>>Both prefer to keep as much money to themselves as possible, all else equal.
All else equal, dude. That means among situations where the thing changes ownership, A wants to pay as little as possible while B wants to get as much money as possible. Not an unrealistic assumption.

>It might be possible to use something like the en.wikipedia.org/wiki/Elitzur–Vaidman_bomb_tester to exploit quantum mechanics in order to semi-destructively test for dishonesty through QUANTUM TORTURE
Ö_Ö th-thanks for your valuable post

>an undefined amount of money possessed by each person which we will represent as n ( n= 0>n>1)
u wot
The philosophical difference between commies and pro-capitalism folks seems to be that commies have all sorts of opinions about the real-world relevance of this puzzle while you guys have no basic grasp of math and logic.

ITT moar materialism

Whats the deal with post-Keynesian socialists? are they just Market Socialists?

If you follow the things Keynes said to their logical endpoint it figures that the best possible economic system is that where the people who produce (the workers) get rewarded proportionally to their labour and the scarcity of the labour they perform. Exploitation by the bourgeoisie takes away money from the workers (who would spend it sooner) and thus slow down the economy and/or steer it towards producing commodities that are not beneficial to society at large (ie make a yacht instead of new roads)

Behold! I'm reading the mind of the ancap as he is posting this and then re-reads the thread. His mind goes through the following phases:

...

That's a ceteris paribus clause.

Meaning that for the potential buyer, among possible situations where he gets the item, he prefers the one where he pays the least amount. He has an amount in mind that, if he parts with it in exchange for the item, he prefers that situation to the status quo of keeping that amount of money while being without the item. That said, if he gets the item, he of course prefers to pay as little as possible.

Meaning for the potential seller, among possible situations where he parts with the item, he prefers the one where he gets the highest amount. He has an amount in mind that, if he gets it in exchange for the item, he prefers that situation to the status quo of keeping the item while not getting that amount of money. That said, if he parts with the item, he of course prefers to get as much money as possible.

That is referring to the situation, the mind state of the people in the puzzle. Is that a crazy assumption? I can't read other people's minds, but to me it seems about as banal as it gets.

That is a reference not to the state of mind of the people, it is part of the challenge:
That is, given that the people are self-interested as described, can you find an algorithm that, among other things, prevents honesty from being a sub-optimal strategy?

...

The perfect algorithm for solving this puzzle isn't known, and such an algorithm cannot be constructed. "I will drop communism the instant you show me the solution to this puzzle…" The meaning of this sentence is not a fallacy, it's a long-winded way of saying, "I will NOT drop communism". What else follows from the perfect algorithm's non-existence?

Imagine what the world would be like if the puzzle had a perfect solution: You go to a flea market, see a thing you want to have, and there is a magical device that you can tell the maximum amount you are willing to pay, and likewise the guy who wants to sell it tells the device his minimum price. Then the device tells you two what to do, and you are both happy knowing that there is no point in trying to game the system. No haggling over prices, anywhere, ever.

The pro-capitalist arguments usually start from individuals and their individual decisions. "You and another person come to an agreement, and now imagine some third party meddles with that, wouldn't that be terrible." Being free from that third-party meddling seems better, right? Whether that bureaucrat is a Stalinist, Confucian, overbearing parent, whatever. That's something we can all relate to, even the Stalinists. And then the argument goes: "You two being free from that meddling, that's a moment of capitalism. And when you have a society where lots of these small interactions and agreements are free like that, all these small freedom atoms add up to THE BIG FREEDOM, and that's a proper capitalist society."

But these freedom atoms don't exist.

So, what does it mean for real-existing capitalism that market trade follows the form 1 & 2 & 3, without 4? The trade occurs if the buyer's maximum price is no smaller than the owner's minimum, and it happens at some point in the interval between the owner's minimum price and the buyer's maximum, and both parties prefer any situation with the trade happening with payment at whatever point inside that interval relative to the situation where neither the thing nor money changes hands. Why dwell on that so much?

At which point in the interval the trade happens is not equally likely for each point. There are those who have resources and who can afford to refrain from making deals for some time, and those who can't. The factories may rust, but the land they stand on doesn't rust. The business man can afford to to be patient relative to the worker (and the landlord can afford to be patient relative to both). The interval tends to be cut in a way that the more powerful side will tend to get more from the happiness pie. And this isn't just about subjective happiness. And such a deal doesn't happen once with the more happy side immediately consuming away what they got, this goes on and on and it reproduces the hierarchy. Being poor or rich are not just outcomes that happen at one point, the existence of rich and poor is also an input in the system, a cause of the continuing existence of rich and poor.

And how does an apologist for capitalism deal with that? By putting into the models the bizarre assumption of infinite competition that supposedly works out in a similar way to the government price-setter in .

Those "friends" don't exist in isolation from the rest of the economy you fucking retard, and even if they did, an exchange between them would have absolutely nothing to do with value theory or capitalism.

Now take your shitty bald man meme and shove it up your arse.

Whether it is wrong to use a very abstract model depends on for what purpose you use it.

Suppose we are talking about a bag of problems and there are folks who claim there is a machine that solves the whole bag of problems. These folks use a model consisting of only a few of these problems and demonstrate that the machine solves that bag. Does this abstract model prove that the machine can solve our bag of problems? No.

Suppose we are using a model with a different subset of problems, and we show the machine can't solve it. Does this abstract model prove that the machine can't solve our bag of problems? Yes.