Use game theory to end junk mail!

I get a bunch of junk mail, even though I never even look at it, let alone buy anything from it. I throw it away immediately, often casually risking throwing away real mail too because I can’t even be bothered to sort through the pages those thick advertisement fliers. My life would improve if I didn’t get any.

The lives of junk mailers would improve too, if they could exclude me from their mailings. And they could easily do so, e.g., by just removing me from the lists.* So why can’t I contact them and tell them to remove me?

Two reasons: one, there isn’t a central listing and it would be very inefficient to contact every junk mailer. But, more importantly, two, advertisements work by undermining commitments not to buy — a large part of the point of advertising is that even if you think you won’t buy, it may tempt you. So even if I say, and genuinely intend, that I won’t buy anything from their ads, the ads are cheap enough that it’s worth the bet to the advertiser that one day I’ll succumb to temptation.

Game theory can solve this using commitment devices! Suppose I contracted with a service like stickk.com to punish myself, by, e.g., making a large donation to the Republican party if I ever bought anything using a coupon delivered in one of those advertisements. Then I could credibly commit to not buying anything even in the face of temptation, and the advertisers would have no reason to send me the ads.

How to enforce these contracts? (If I succumb to temptation, why can’t I just lie about it?) One possibility is just to recruit friends to help, on the stickk.com theory, perhaps giving them a cut of the penalty. But there isn’t really an incentive for them to tell the truth either. But why not recruit the actual businesses to help?

“What the fuck?” you may be thinking here. “How does that idiot Gowder think that business can be recruited to sabotage their own advertising strategies?” Here’s a theory. People who really dislike advertisements aren’t going to succumb to temptation very often, and an individual business only gets a very small cut of the probability of succumbing in any specific instance. So the expected payout to an individual business from an ad being sent to someone like me is very tiny, the real profit is to the advertising company who gets to inflate circulation figures with crappy customers. So why not pay each advertising business their expected profit from a direct mail advertisement directed toward an individual (probably pennies), plus some nominal amount for administrative costs, on the condition that they report all coupon-users to the central punishment agency?** Then the punishment agency can check the list of coupon-users against the list of clients and impose punishments. (Though, of course, this will be nearly costless because temptation and punishment will be off the equilibrium path.)

I suppose it might be simpler just to pay a central agency who pays the advertisers not to send the damn things, Coase-theorem style. But my method seems much more fun. Because it involves punishment. I like punishment.

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* That might not be the case for the loose-leaf bulk advertisements — I suspect their contract with the post office is cheap because it goes into all boxes without discrimination, eliminating sorting costs. But certainly the targeted ads. And it would be fairly easy to implement some kind of sign to be placed in mailboxes to indicate that the mailbox owner is a no-junk-mail person s.t. the post office can costlessly pass it over.

** This should be actually profitable for businesses: they’re getting their expected revenue from me, and, since as ad circulation goes down by eliminating bad customers like me, the cost of advertising will be cheaper, the amount of expected revenue per dollar invested will go up on the rest of the ads. At least, this seems right on my very casual, seat-of-the-pants thinking, though I’m doubtless forgetting some important fact.

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One Response to “Use game theory to end junk mail!”

  1. Robert Rijkhoff Says:

    Brilliant, bring on the Punishment Agency :)

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