The Coupled Portfolio: Relative Blame and the Anti-Markowitz Geometry of Oversight

Abstract

Recurring oversight blind spots — an auditor who misses a specialist's error — are increasingly read as equilibria: where blame for a missed failure rises with how much a monitor could see, seeing less is a way to bear less. A companion model shows the blind spot survives across a portfolio of controls, but couples them only through a shared attention budget, leaving a trapped control inert. This paper makes blame relative — judged against the diligence the monitor demonstrably exercised elsewhere — coupling the controls through a positive, symmetric blame-covariance. Relative blame then recruits a trapped control past a finite threshold, breaking that inertness; yet because the covariance is symmetric, recruitment is ordered by the stakes of the rest, so the blind spot is stickiest where every control is high-stakes. Equivalently the monitor holds the anti-Markowitz portfolio, its coverage falling rather than rising in stakes. Yardstick evaluation, meant to broaden coverage, can entrench the blind spot it was meant to close.