There are many things that we all would like to see realized, but no individual has an incentive to contribute to. Assurance Contracts have a novel payoff structure. We pre-commit to take an action —such as giving x amount of $/BTC/other cryptocurrency to the longevity/journalism/open source project of our choice— if and only if enough others commit to do the same to reach a critical threshold. Dominant assurance contract have the added condition that if the funding benchmark isn’t reached, the provider pays a prize to the pledgers. Pledging becomes a dominant strategy, or in Tabarrok’s words, “a no-lose proposition—if enough people pledge you get the public good and if not enough pledge you get the prize.”
This meeting is part of the Intelligent Cooperation Group and accompanying book draft.