I am happy to announce a new paper I co-wrote with Anders Sandberg, which is now a public preprint (PDF). This is a link-post for that paper, and to a post on Lesswrong that contains a summary of some of the arguments.
Abstract: How much value can our decisions create? We argue that unless our current understanding of physics is wrong in fairly fundamental ways, there exists an upper limit of value relevant to our decisions. First, due to the speed of light and the definition and conception of economic growth, the limit to economic growth is a restrictive one. Additionally, a related far larger but still finite limit exists for value in a much broader sense due to the physics of information and the ability of physical beings to place value on outcomes. We discuss how this argument can handle lexicographic preferences, probabilities, and the implications for infinite ethics and ethical uncertainty.
The main reason for taking the simulation hypothesis seriously is the simulation argument, but that argument needs to assume that our physical models are broadly correct about reality itself and not just the "physics" of the simulation. Otherwise, there would be no warrant for drawing inferences from simulated sense data about the behavior of agents in reality, including whether these agents will choose to run ancestor simulations.