Contracting-out Contract Law

0 comments

file time: 2008-02-16

filetype:ppt

Click Here To Download...

>  
 
 
 
 

Contracting-out Contract Law 

Importing Trust into Low-Trust Societies Electronically 

Mark S. Miller

CTO, Combex Inc.

Open Source Coordinator, ERights.org

Director, Extropy Institute

 
 
 
 
 

What Went Wrong? 

End of communism

Great liberation from oppression New leaders include many free market folk Vaclav Klaus, Miseans in the Baltics, Poland, etc. Soros, others, eager to help

00t is easy to turn an aquarium into fish soup, but not

  so easy to turn fish soup back into an aquarium.00/font>

                                                           00ech Walesa

 
 
 
 
 

Low-Trust Societies 

From 00rust00 00he Other Path00 E. Dyson

Absence of oppression isn00 enough Complex extended cooperation requires trust

Besides culture, what?

Accumulated 00apital00 of widely trusted intermediary institutions Secures relationships & contracts among others  
 
 
 
 

Hubs of High Trust 

Actual 

Virtual

 
 
 
 
 

Low-Trust Tragedy 
Not no trust.  No trust hubs. 

Actual 

Virtual

 
 
 
 
 

Hubs: Trusted Intermediaries 

Arbitrators, Banks, Notaries, Visa,

Underwriters, Lloyd00, Sotheby00,

Exchanges, Brokers, Funds, Escrow,

Consumer Reports, Roger Ebert, 00 

Courts, Law, Enforcement, Money

yeah, but still better than their absence  
 
 
 
 

Bits Without Borders 

Can now purchase e-goods & e-services

from across the world as easily as next door.

Escape old limits of geography & jurisdiction.

Can trust-hubs escape too?

Can they be made purely electronic? Mostly independent of physical interaction

Many 1st world hubs are trusted worldwide

 
 
 
 
 

Remote Trust Bootstrapping 

1st World 

3rd World

 
 
 
 
 

Smart Contracts 

Contract as Program Code

Terms enforced by program00 execution Inescapable arrangement vs. punishment.

Contract host == trusted escrow & enforcer

Private law provided per-contract  

Nick Szabo00 www.best.com/~szabo

Our 00i>Capability-based Financial Instruments00at FC00

 
 
 
 
 

Contracts as Games 

Players make moves, but only 00egal00ones

Move changes state of board Board-state determines move 00egality00/font>

ERights are 00ieces00placed on board

Game escrows pieces, Pieces/ERights released only by play  
 
 
 
 

A Simple Exchange Game

 
 
 
 
 

A Covered Call Option

 
 
 
 
 

The Game Design Game 

Contract Negotiation as Game Design

Framework as the Game of Game Design

Design rules for game all are willing to play Write 00oard manager00 for that game Agree on a mutually trusted host Pay host to run the board manager Host verifies everyone agreed on same game  
 
 
 
 

World Isn00 Purely Electronic 

1/10th of law 

10/10th of law 

Jurisdiction-free 

Moral influence 

9/10th of law 

Legacy-legal

compatible 

Public eTitle in physical goods

(tractor, land) 

Purely electronic rights

(money, stock)

 
 
 
 
 

Why the 3rd World First? 

Less burden of installed base

Like cell-phones in Eastern Europe. Where legal system isn00 thought legitimate, 
legitimate businesses need not be legal. Especially given alternate source of legitimacy.  
 
 
 
 

00ule of Law & Not of Men00/font> 

The Classical Liberal ideal

A neutral simple framework of rules

enforced impartially & justly enabling cooperation without vulnerability

The old 00ight of contract00/font>

Any mutually acceptable arrangement Law secures it, as a trusted intermediary

   download Contracting-out Contract Law