Escrow agents

[Tim May]

This is well-trod ground. I'll have to be brief here.

At 2:06 PM -0700 4/15/01, Ray Dillinger wrote:
>On Sun, 15 Apr 2001, Tim May wrote:
>
>  >Widespread black markets, for drugs, betting, etc., suggest otherwise.
>  >
>>There are many markets out there which do not rely on the official
>>court system to enforce contracts for.
>
>This is true, but look at the mechanisms for enforcing contracts
>that they *do* use.  Most of them are not compatible with anonymity,
>and only a few are compatible with pseudonymity.
>
>Mafia Bosses don't buy information from someone when they don't know
>where that someone lives.  It's the exact same enforceability of
>contracts problem that other parts of society uses lawyers to deal
>with.  Legbreakers or cops, basically they have the same job with
>regard to contract enforcement.  There has to be a hook where someone
>who does a ripoff can be punished, or else there is no deal.

You are talking about what game theorists call "defection," or what 
drug dealers would call "burning." Cheating, deception, etc. No one 
can deny that animals, humans, and other agents use deception, 
hiding, coloration, etc. Nothing is perfect, not even in the 
"law-regulated economy" some folks seem to think is the only economy 
which can function.

How non-law-regulated (black) markets work, and how they deal with 
deception and cheating, is a huge topic. (I recently suggested to 
David Friedman that he consider taking on this topic for a major 
book.)

But the "paving stone," or touch stone, I want to bring up is this: 
the role of third party escrow agents.


Use Google or a similar search engine and search on "cyphernomicon 
escrow". The section on use of escrow agents will come up immediately.

One such URL is http://calvo.teleco.ulpgc.es/cyphernomicon/chapter16/16.24.html


(I have written dozens of articles on this over the years, answering 
the same tired old question that Ray Dillinger asks.)

When you have read this, and thought about the issue, we can discuss 
things further.


--Tim May
-- 
Timothy C. May         tcmay at got.net        Corralitos, California
Political: Co-founder Cypherpunks/crypto anarchy/Cyphernomicon
Technical: physics/soft errors/Smalltalk/Squeak/agents/games/Go
Personal: b.1951/UCSB/Intel '74-'86/retired/investor/motorcycles/guns