Project CELLA: Finnish Social Security reverse engineered


Chess-like life analogue (game)

Document and investigation into bureaucracy, friction, and exploit

Jukka P Paulin






6.11.2013 Adding people to the project; mentioned about CELLA in a Facebook conversation

Editorial notations

ADD_ xxxx = add content here; specifies also the type of figure or fact
that is expected


The original setting at which I started to write this survey
(or essay) was at Aalto University department of Industrial
management. I had taken organizational psychology studies
before, and now in the middle of finishing my B.Sc in
Computer science.

I, personally, wanted to break down and completely reshuffle the pack of
citizen cards, so to speak. I wanted to know what were the limits
of automated information processing in everyday use; how much of
the bureaucratic processes could be alleviated by use of IT.

Research motive

“To objectively research, in-depth, the financial aspects of what
I perceive to be a kind of `glass bead game`; the citizen’s
gaming in the jungle of bureaucracy.”

The research includes in-depth view from a (social security)
client perspective into the processes, obligations and rights
provided by the legal framework of Finland.

It is bureaucracy that creates a loophole for exploitation. It
is also deemed a necessary by-product of the execution of laws
set forth by the legislative organs of a state. Bureaucrats
are the information processing agents who have a definite
set of responsibilities and a limited set of means to coerce

Some processes are very straightforward and interaction (choice)
is limited; others are such that there is almost an infinite
variety of individual steps in the process.

Thus realistically speaking the social security can be viewed
in two complementary aspects: that what was supposed to happen,
and that what actually happens. This is characteristic to many
policies; they have unintentional side-effects. For example,
many social security systems have been blamed to have two negative

Research methodology

– defining `payoff functions` for different choices a citizen can make
– estimate the clinical (financial) benefits a citizen is likely
to have from spending time filling forms and applying for help
– research whether there exist “moral hazard points”, discontinuities,
or other anomalies in the fairness and understandability (logic)
of social benefits.
– are there paradoxies in how the system treats
a) the people most in need of financial support
b) people who are in the upper scale of wealth or income
– moral hazards seem to exist at least in the..
* fact that social security somewhat covers (‘rewards’) a
lavish lifestyle; it does not allow social upward mobility
since if you had a bit more money than another recipient,
the amount of benefits goes down. Thus this can also be
interpreted that those who manage to spend more get
also more benefit covered.

– adapt the framework of mathematical game theory into this research

– research whether the knowledge of law makes a different in payoff
function behaviour; ie. does a more “intelligent” player gain
also more financial benefit from the system?

– assume a `savant player` option where the citizen just brute forces
through social security, without thinking about the options too much
(or at all)

– two scenarios for analysis:
– one simplified which does not take into account the actual
work of getting forms filled (work due to “information friction”)
– realistic model that calculates some value to the time
and effort spent due to information friction

The payoff functions are defined generally in economical analysis
as the logic behind action-payoff (consequence) sequences. Payoffs
originated in John Nash’s `game theory` as analysis of different
kind of games. Bureaucratic activity can be viewed as a game,
forgetting the connotations here associated with the word “game”.

Payoff is the known or expected benefit that a certain pattern of
choices results in. Depending on the type of game and information
available, the player can sometimes choose also the risk level
by knowing the payoff functions on a detailed level.

Short review of employee’s decisions and choices in working life

The citizen (here, an “employee”) can move between certain modes.

The modes are listed below:
* entrepreneur
* employed (“salary man”)
* unemployed, no social security
* unemployed with union-backed social security “ansiosidonnainen”
* part-time working, no ongoing social benefits
* part-time working with social security benefits
* student with or without social security benefits

Information vehicles

Information is the raw food of processes. It is carried though
in very varied “vehicles”: paper, the human mind, and digital
world (memory chips, cache, registers, tapes, etc.) In addition,
in the digital world, protocol and format are two curse words
that have ravaged the world ever since the very first information
processing machines arose early in the 20th century. Since the
vehicles are sometimes incompatible and even essentially in
different domains (paper vs. digital information), these
practical points have become somewhat of a showstopper. Many
swift transactions suffer from the (often) unnecessary “gap”
of going into manual work phases. Examples are abundant; one is
the manual processing of cheques:

“Before the mid-1940s, cheques were processed manually using
either the Sort-A-Matic or Top Tab Key method. The processing
and clearance of cheques was very time consuming and was a
significant cost in cheque clearance and bank operations. As
the number of cheques increased, ways were sought for
automating the process.”

Some banks, indeed, had to close doors at around 2 PM in order to
devote the rest of the working day for this processing.

The impact of going fully electronic may have interesting implications.
For one, it takes away (should take) most of the “friction” in the process
of applying for social security; so the citizen’s benefits no longer
are hindered by the physical difficulty of applying. Currently, in 2013,
it is still somewhat of a bureaucratically heavy process to apply
for benefits. (ADD_estimate-%)

The Time-Pits

I found out that a lot of those “bureaucratic shit tasks” I hated
came down to a specific kind: tasks that require a lot of input,
perhaps from scattered sources, and produce relatively little
immediate juice; that is, filling out forms, gathering
cross-sectional information from the history; adding up things,
summing days, looking at the calendar and weeding out holidays from
workdays – this kind of things.

Immediate questions rose in my mind:
* could the time pits be automated?
* what was required to smooth things out?
* could I single-mindedly help myself out, or did it require the
big G (government) to comply with my information needs?

In which we plan the mechanisms, sketch the design of CELLA.

Terminology used throughout the document

Single loop learning

Double loop learning


Cognitive dissonance


Dispute settlement



Automated information processing

optical character recognition


Movies related to game theory

1. U. Yale lecture on game theory, series #6

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