Predicting the Future with Math

By | October 30, 2007
3 Comments

Via GeekPress, here’s a profile of Bruce Bueno de Mesquita, whose game-theory methodology for predictiong the future we discussed in a recent FastForward Radio. It’s an interesting methodology:

The elements of the model are players standing in for the real-life people who influence a negotiation or decision. At each round of the game, players make proposals to one or more of the other players and reject or accept proposals made to them. Through this process, the players learn about one another and adapt their future proposals accordingly. Each player incurs a small cost for making a proposal. Once the accepted proposals are good enough that no player is willing to go to the trouble to make another proposal, the game ends. The accepted proposals are the predicted outcome.

To accommodate the vagaries of human nature, the players are cursed with divided souls. Although all the players want to get their own preferred policies adopted, they also want personal glory. Some players are policy-wonks who care only a little about glory, while others resemble egomaniacs for whom policies are secondary. Only the players themselves know how much they care about each of those goals. An important aspect of the negotiation process is that by seeing which proposals are accepted or rejected, players are able to figure out more about how much other players care about getting their preferred policy or getting the glory.

Bueno de Mesquita has achieved an impressive list of correct predictions using this approach, although as Karl Hallowell recently reminded us, people in this line of work tend to play up their successes. For example, how impressive is it that he predicted that the UK would leave Hong Kong 12 years before it happened? Wasn’t their lease about to expire, anyway? On the other hand, two independent evaluations of his work (one by the CIA and one by fellow academics) have shown him to be about 90% accurate.

The earlier article that I read about de Mesquita in Good magazaine mentioned that he is scrupulous in not making information such as the outcome of the 2008 Presdiential elections availabe. This is interesting, in that he doesn’t mind making sweeping statements about what policies will and will not work regarding Iran:

The details of his study of negotiation options with Iran are classified, but Bueno de Mesquita says that the broad outline is that there is nothing the United States can do to prevent Iran from pursuing nuclear energy for civilian power generation. The more aggressively the U.S. responds to Iran, he says, the more likely it is that Iran will develop nuclear weapons. The upshot of the study, Bueno de Mesquita argues, is that the international community needs to find out if there is a way to monitor civilian nuclear energy projects in Iran thoroughly enough to ensure that Iran is not developing weapons.

If real, the ability to make accurate predictions about the future represents a unique form of power. How interesting that he leaves this particular matter open-ended. As described above, wouldn’t Beuno de Mesquita’s methodology have provided an outcome to the situation with Iran? It’s notable that here he talks about how things will work out if… Of course, it’s possible that he’s just being evasive becuase he’s not allowed to talk about the results. But I can’t help but wonder whether he has seen the future, he doesn’t like what he sees there, and now he’s trying to do something to stop it.

Would such an act represent an abuse of Bueno de Mesquita’s (hypothetical) power? The fact that he won’t give away presidential election results indicates that he doesn’t want his information to be used to change how things would have otherwise worked out. But then that’s absurd. Somebody is paying his company to make predictions (the State Department is mentioned as one of his clients) and you can be sure that they are acting on the information.

So it’s possible that Bueno de Mesquita sees a very bad end coming to the Iran situation, and he is giving the above warning as a means of trying to prevent it. And that is just a little scary.

  • https://www.blog.speculist.com Stephen Gordon

    This reminds me of the fictional science “psychohistory” that Asimov described in his Foundation novels.

  • http://www.google.com/search?q=bayesian+confidence MikeD

    I see the refusal to make the prediction public as a means of limiting the feedback against the prediction itself impacting the variables used in the prediction. It becomes exceedingly difficult to make self-referential predictions. I’m sure that is more true over time as your success rate increases so much that the mass of players have noticed and are poised to change the game based on your prediction of it.

    * Google: Bayesian Confidence

  • MDarling

    Of coure there’s a “…very bad end coming to the Iran situation,…”

    Picture this, Phil.
    For reasons presonally vitally important to yourself you decided you had to have nuclear (new-kleer) weapons technology and nuclear weapons. You read the books to understand how to do it, and you realize that creating enriched uranium is politically, financially and socially easier than buying it from an available source. So you start down the path of trying to make it.
    But you get far enough down that road and you realize that the 2 or 3kg you will make in the short term just isn’t going to do it for you. If only you could but it on ebay or from some other easily accessed source. But you can’t.

    But Iran has Pakistan. And Pakistan has thousands of kg of enriched uranium. Of course they aren’t Persian, and their Islamc brotherhood may only take them so far, and perhaps we could trust Musharraf to do what’s good for the US and the rest of the “please-don’t-nuke-us” world.

    In short- Tehran will have nukes when they want them. They have said they will use them when they choose. Ideoligically, even the moderate voices in IRan of the past few decades have said that Israel and US interference in the region is a threat to Iranian sovreignty and the problems in the region.

    What I don’t get is this- Israel apparantly has no problem conducting airstrkes in other countries when they see the need – most recently in Syria. But previously in Lebanon, Egypt, Jordan, and Iraq. They can reach Iran- why haven’t they?