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<< In a meta-game, incentivising other entrepreneurs to enter the Dominant Assurance Contract market, driving down the cost disadvantage of Dominant Assurance Contracts verus Assurance Contracts. >>
Can anyone make this clear?
The article begins saying assurance contracts are a 'financial technology', which suggests to me they are actually existing devices in financial markets. But then the rest is a rough theoretical sketch, which doesn't make things much clearer.
Can someone explain - is this talking about actual financial market practices? If so: examples, history ...?
Or is this a purely theoretical concept. If so - whose, where, sources ...? Bengalski 22:57, 2 January 2006 (UTC)
What happened to the content at
http://en.wikipedia.org/wiki/Dominant_assurance_contract
?!?!
Christ, it's not in deletionpedia or archive.org, but I seem to remember there being more content than what's here. Will this not stop until Wikipedia is in ruins? beefman ( talk) 07:28, 18 January 2009 (UTC)
I really think that sites like Kickstarter should be mentioned. Kickstarter match this description very well: Somebody offers to do something, sets a date, sets a amount of money to be donated and may also offer specific things to those who have contributed a certain amount (let's say a signed CD to people who contributed over $50, as example), and if the amount is not met by the date that was set, the contributions are refunded. AFAIK there's no requirement that the result should be publicly available, it could be a subscription service where all the contributors automatically gets a subscription. Does it deserve to be mentioned in the article? 109.58.65.59 ( talk) 11:44, 19 September 2010 (UTC)
Tabarrok concludes, that his model would motivate everyone to contribute.
But this assumption has no basis, as it does not follow from the model.
In fact, one gets actively rewarded for making the project fail.
Instead of a sane model, it reminds one of a typical “private equity” company like
Bain Capital, which deliberately buys, wears down, and then kills off companies because of a guaranteed reward (even) in case of bankruptcy.
This abusive vampirist relationship is demonstrably not a basis for a working market, and in fact should be highly illegal, analogous to pimping and murder of slave prostitutes.
– 92.72.231.17 ( talk) 11:41, 25 June 2013 (UTC)
The intro states that assurance contracts provide a solution to the free rider problem. However, I was not able to understand how these are related from the description given in the article. It seems like the free rider problem still applies to public goods funded by assurance contracts, as rational actors may decide not to pledge in order to let others provide the funding. It seems like assurance contracts solve an entirely different problem, the risk of investing in something that requires a certain minimum amount of funding to get off the ground. The article needs to have an explanation, preferably sourced, of how the free rider problem relates to assurance contracts. 67.188.230.128 ( talk) 06:53, 4 December 2014 (UTC)
As mentioned above, assurance contracts, unless some further argument can be made, seem to have nothing to do with solving the Free Rider problem mentioned, but are about people minimizing their risk in committing to some action only as part of some contingency - such as not committing money to buy a product from a new company until it's gotten enough funding from others that those products will be made Countwiki ( talk) 15:49, 14 June 2017 (UTC)