This link has appeared before on the NEXUS but deserves to be widely known:
http://www.simulation-ar...ent.com/simulation.html
Much of the paper is rather weak philosophy and pseudo-applied-math but the "Interpretation" section has many interesting ideas germane to this forum. Here is an extended excerpt:
"The possibility expressed by alternative (3) is the conceptually most intriguing one. If we are living in a simulation, then the cosmos that we are observing is just a tiny piece of the totality of physical existence. The physics in the universe where the computer is situated that is running the simulation may or may not resemble the physics of the world that we observe. While the world we see is in some sense “real”, it is not located at the fundamental level of reality.
It may be possible for simulated civilizations to become posthuman. They may then run their own ancestor-simulations on powerful computers they build in their simulated universe. Such computers would be “virtual machines”, a familiar concept in computer science. (Java script web-applets, for instance, run on a virtual machine – a simulated computer – inside your desktop.) Virtual machines can be stacked: it’s possible to simulate a machine simulating another machine, and so on, in arbitrarily many steps of iteration. If we do go on to create our own ancestor-simulations, this would be strong evidence against (1) and (2), and we would therefore have to conclude that we live in a simulation. Moreover, we would have to suspect that the posthumans running our simulation are themselves simulated beings; and their creators, in turn, may also be simulated beings.
Reality may thus contain many levels. Even if it is necessary for the hierarchy to bottom out at some stage – the metaphysical status of this claim is somewhat obscure – there may be room for a large number of levels of reality, and the number could be increasing over time. (One consideration that counts against the multi-level hypothesis is that the computational cost for the basement-level simulators would be very great. Simulating even a single posthuman civilization might be prohibitively expensive. If so, then we should expect our simulation to be terminated when we are about to become posthuman.)
Although all the elements of such a system can be naturalistic, even physical, it is possible to draw some loose analogies with religious conceptions of the world. In some ways, the posthumans running a simulation are like gods in relation to the people inhabiting the simulation: the posthumans created the world we see; they are of superior intelligence; they are “omnipotent” in the sense that they can interfere in the workings of our world even in ways that violate its physical laws; and they are “omniscient” in the sense that they can monitor everything that happens. However, all the demigods except those at the fundamental level of reality are subject to sanctions by the more powerful gods living at lower levels.
Further rumination on these themes could climax in a naturalistic theogony that would study the structure of this hierarchy, and the constraints imposed on its inhabitants by the possibility that their actions on their own level may affect the treatment they receive from dwellers of deeper levels. For example, if nobody can be sure that they are at the basement-level, then everybody would have to consider the possibility that their actions will be rewarded or punished, based perhaps on moral criteria, by their simulators. An afterlife would be a real possibility. Because of this fundamental uncertainty, even the basement civilization may have a reason to behave ethically. The fact that it has such a reason for moral behavior would of course add to everybody else’s reason for behaving morally, and so on, in truly virtuous circle. One might get a kind of universal ethical imperative, which it would be in everybody’s self-interest to obey, as it were “from nowhere”.
In addition to ancestor-simulations, one may also consider the possibility of more selective simulations that include only a small group of humans or a single individual. The rest of humanity would then be zombies or “shadow-people” – humans simulated only at a level sufficient for the fully simulated people not to notice anything suspicious. It is not clear how much cheaper shadow-people would be to simulate than real people. It is not even obvious that it is possible for an entity to behave indistinguishably from a real human and yet lack conscious experience. Even if there are such selective simulations, you should not think that you are in one of them unless you think they are much more numerous than complete simulations. There would have to be about 100 billion times as many “me-simulations” (simulations of the life of only a single mind) as there are ancestor-simulations in order for most simulated persons to be in me-simulations.
There is also the possibility of simulators abridging certain parts of the mental lives of simulated beings and giving them false memories of the sort of experiences that they would typically have had during the omitted interval. If so, one can consider the following (farfetched) solution to the problem of evil: that there is no suffering in the world and all memories of suffering are illusions. Of course, this hypothesis can be seriously entertained only at those times when you are not currently suffering."
[MOD EDIT: Changed thread title to correspond with the attached paper as to remove confusion and keep appropriate to the philosophy section.]