The Importance Of Chance…

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Is “knowing more” always desirable?…

As counter intuitive as it may seem, there can be a downside to “perfect knowledge” – to having a completely transparent view to something. The fact is, we are creatures of chance. Avoiding knowledge, or acting in spheres where knowledge is limited, are very real components of how we operate as individuals and as a society. I would go so far as to posit that we need an element of uncertainty around what we do if we want to function optimally.

A good example of this is the enforcement of traffic speed limits.

Many drivers operate in the ‘gray area’ that lives at the edge of existing laws. Most will regularly go 5-10 MPH above the posted speed limit, and some will be willing to do a lot more than that. They do this because it “gives them an edge”, and the chances of “getting caught” – of being penalized for the violation – are small.

And law enforcement counts on this…

Most local and state police forces generate meaningful revenue from traffic violators. They depend on having people who are willing to ‘take a chance’ by speeding so they can keep this money flowing into their treasury. To encourage this behavior, police will often tolerate a certain level of non-compliance to maintain a steady stream of revenue producing violators that go beyond it. In effect, they create a loosely defined safe zone that extends beyond what the law proscribes – a safe zone that baits people into violating the law so they will continue to operate in this revenue producing area of chance.

And they know that having perfect knowledge would hurt them…

A zero tolerance policy for speeding would probably be very effective. It could even be implemented in practical ways. Many major toll roads track where you enter and exit the road, and charge you based (loosely) on distance traveled. They also track the time you entered the road and the time you left. It wouldn’t take much for them to combine these to calculate your average speed, and to use that to automatically generate fines for those that clearly broke the speed limit.

It’s possible that doing this could generate a near-term spike in fine based revenue, but once people knew that any speed violations would be detected and punished, they would simply stop speeding.

And the revenue would dry up completely…

This bigger model they count on just doesn’t work without chance. So instead, a sub-optimal enforcement model is chosen that attempts to balance the desire for revenue generation with optimized traffic flow and respect for the law. It’s a model that introduces chance into the mix by consciously limiting the information law enforcement chooses to collect. Thus, we end up having randomly positioned highway patrol officers with radar guns looking for violators instead of a more comprehensive and effective approach.

And this desire for imperfect information appears to be reciprocal…

Most people I’ve asked (admittedly a far from scientific sampling) seem to prefer the less deterministic approach to getting a speeding ticket. The thought of automatically getting a “ticket in the mail” if they crossed some specific speed threshold seemed almost draconian to them. They would lose the option to go faster than other drivers – even if it isn’t something they would routinely do. This would force them to limit themselves to a certain speed, and become far more passive – something that goes against their inherently competitive nature.

So they prefer to take their chances instead.

What does all of this have to do with technology?…

blog-piracybutton.jpgThis preference for chance is at the heart of the dilemma facing the record industry. The RIAA’s attempts to sue individual illegal file sharers is essentially the online equivalent of the hidden patrol car looking for speeders. It is simply too random to change broad user behavior. Just like speeders, illegal file sharers would change their behavior if they knew they would be caught.

But they know odds are in their favor – so they don’t…

What’s interesting is that the recording industry – unlike law enforcement – hasn’t figured out a way to generate revenue from this user behavior. In fact, they actully want to try and end it completely, even though it presents them with real opportunities for meaningful revenue. They simply can’t get beyond their own narrow definition of how their business can work. Despite the significant market dislocation a business model change would entail, the potential upside of making the change is certainly more compelling than the “death spiral” the record industry has fallen into from clinging to the status quo.

They just need to be willing to take a chance…

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  • http://www.motoringlawyerdirect.com/ Speeding Fines

    Thanks for the really interesting article. There is a lot of really useful and relevant information about speeding fines and you raise some interesting disussion points.

  • http://www.motoringlawyerdirect.com/ Speeding Fines

    Thanks for the really interesting article. There is a lot of really useful and relevant information about speeding fines and you raise some interesting disussion points.

  • http://www.motoringlawyerdirect.com/ Speeding Fines

    Thanks for the really interesting article. There is a lot of really useful and relevant information about speeding fines and you raise some interesting disussion points.