Tuesday, July 07, 2015

[bovaotdy] Fail open for greater good

In general, fail open rather than fail closed.

In an open system, market forces (broadly defined) can achieve an efficient outcome.  If you zoom out far enough, failing open often results in at worst a "mere transfer", so macroeconomically neutral.

The canonical example is an door lock failing open, unlocked. Stuff gets stolen, "transferred".  In contrast, the door failing closed, so that no one can unlock it, leads to a Pareto-dominated waste in which no one can access what's beyond the door.

But tragedy of the commons can occur in failing open.

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