This isn't theoretical, it's happening right now. The boom in digital detoxes, the dumbphone revival among young people, the shift from public feeds to private DMs, and the "Do Not Disturb" generation are all symptoms of the same thing. People are feeling the manipulation and are choosing to opt out, one notification at a time.
That disengagement metric is valuable, I'm not gonna give it away for free anymore. I'll engage and disengage randomly, so no one knows what works.
> The boom in digital detoxes, the dumbphone revival among young people
That's a market now. It doesn't mean shit. It's a "lifestyle".
> People are feeling the manipulation
They don't. Even manipulation awareness is a market now. I'm sure there are YouTubers who thrive on it.
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How far can you game a profiling algorithm? Can you make it think something about you that you're not? How much can one break it?
Those are the interesting questions.
If you know which car you want to buy it doesn't matter what the salesman has to say.
Anecdotally, when I bought my car recently, they forgot to even offer me the extended warranty they'd planned to push. I find it funny to think it was so minor, even they forgot to care.
I paid for an extended warranty on the first car I ever bought. Turned out it didn't cover any of the things the salesperson cited as good reasons to pay for it, and to maintain the warranty, I'd have to pay the dealer for all maintenance - even oil changes.
That car never needed any repairs, but seeing the list of exclusions convinced me to never pay for an extended warranty again.
If this were true, it would result in a loss for the issuer of the warranty.
You wouldn't pay someone else to insure a common vegetable, because it is so low cost that if it turned out to be bad, you would just buy another one (or have bought extra as your insurance).
When you buy from Walmart/Target/Amazon/Best Buy, they will try to sell you insurance for a $30 toaster or other cheap appliance. Again, most people will not buy this because they will believe the appliance will work sufficiently long or that the warranty process will be too time consuming, or otherwise decide that just quickly replacing the cheap appliance with another is the preferred way to insure it.
The insurance seller is a business and has to earn more than what they pay out for claims (or at least to make payroll if it is a mutual insurance company). Otherwise, they are going to lose money over time and go out of business. If you financially benefit from it, then you are either lucky, or had an information edge over the insurance underwriter.
Of course, if you get peace of mind from buying insurance, and count that as a benefit, then most insurance is beneficial in that case.
https://news.ycombinator.com/item?id=44490667
Insurance seller has to earn at least enough for payroll, so at least some of the premiums go towards that instead of any money received from claims.
Investment earnings cancel out because both the insurance buyer and insurance seller have access to same returns via broad market index funds. I.e. you can self insure and get the same returns on your savings that the insurance seller is going to get if you gave them a premium.
Think about it this way: on a given year, they are collecting "Sales" amount of money from their pool of customers. For the insurer to make a profit, the amount reimbursed to legit claims simply has to be less than Sales-Expenses that year, which basically translates to having Z customers claims on any given year where Z << NbOfCustomers.
So it's a bit like a Ponzi scheme, whereby you can benefit as a customer if you pay year 1 and get a claim during year 1 or 2 for example, and the insurer can benefit too if many customers pay "a year in advance" (money that can be invested) before having their claims fall on years 2 or 3 (or never).
>For the insurer to make a profit, the amount reimbursed to legit claims simply has to be less than Sales-Expenses that year, which basically translates to having Z customers claims on any given year where Z << NbOfCustomers.
That inequality does not “basically translate”. Insurance sellers have to exist for multiple years, not just 1 year.
If every single year, “customer claims” are less than the net benefit of customers, which is what I think you wrote although it is hard to interpret, then your “net benefit of customers” includes a non cash component (such as feeling secure)”.
There is never a free lunch, and the insurance business is not at all like a Ponzi scheme (that’s the whole point of actuaries performing calculations…to ensure sustainability without an ever growing income stream).