Perverse Incentives: Cobra Bounties, Rat Tails and Goodhart’s Law

Mark Twain’s wife offered her children a bounty for dead flies and ended up with an indoor fly-breeding operation. This episode explores perverse incentives, reward structures that produce the opposite of what their designers intended, and the guiding principle known as Goodhart’s law: when a measure becomes a target, it ceases to be a good measure. The hosts first examine the famous Cobra Effect and a 2025 investigation by the Friends of Snakes Society that found no archival evidence the cobra-breeding story ever happened.

Real cases follow: tailless rats in 1902 Hanoi, feral pigs at Fort Benning whose numbers rose because bait improved their nutrition, a 2021 sesame allergy law that led manufacturers to add sesame to plain buns, 3D-printed parts drained gun buyback budgets, and Alberta’s mandatory reporting law that can silence witnesses. The money trail leads to fee-for-service healthcare, a Detroit doctor who gave chemotherapy to healthy patients, percentage-based drug reimbursement, Northern Ireland’s cash for ash scandal, and UN carbon credits that rewarded manufacturing HFC-23 waste, before ending with Hacktoberfest spam, a retailer who abused customers for search rankings, and Amazon’s AI token leaderboard.

  • Why the term Cobra Effect may perpetuate colonial misinformation built on an 1873 rumor
  • How trophy hunting of mature males did nothing to slow pig breeding
  • The chilling effect when reporting late becomes a confession of a crime
  • A subsidy set higher than the cost of wood pellets that collapsed a government
  • Token maxing: gaming a metric with the most advanced technology in history

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