Timeline for Expected value as decision criterion in the context of rare events
Current License: CC BY-SA 2.5
22 events
| when toggle format | what | by | license | comment | |
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| Mar 30, 2013 at 16:09 | answer | added | jdaw1 | timeline score: 1 | |
| Jan 3, 2011 at 16:30 | history | edited | Andrey Rekalo |
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| Jan 3, 2011 at 4:05 | vote | accept | David Harris | ||
| Jan 3, 2011 at 1:50 | answer | added | Andrey Rekalo | timeline score: 10 | |
| Jan 2, 2011 at 11:03 | answer | added | none | timeline score: 1 | |
| Jan 1, 2011 at 6:09 | comment | added | drbobmeister | Every economist in the universe wants an answer to this question! | |
| Jan 1, 2011 at 5:30 | comment | added | Thierry Zell | Anyway, the expectation is merely the first moment of your distribution: knowing the variance, and even better higher moments, will paint a more accurate description of the situation. This is the case in the lottery example, where the variance is huge. | |
| Jan 1, 2011 at 5:23 | answer | added | Thierry Zell | timeline score: 1 | |
| Jan 1, 2011 at 1:20 | history | edited | David Harris | CC BY-SA 2.5 |
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| Jan 1, 2011 at 0:16 | answer | added | David Harris | timeline score: 1 | |
| Dec 31, 2010 at 23:57 | comment | added | R Hahn | The relative merits of maximizing expected utility get to the heart of one's extra-mathematical interpretation of probability, I think. So I basically agree with Gjergji. That said, the question is still interesting to consider, especially because it is not uncommon for expected utility maximization criteria to be accepted uncritically. In some fields, when someone deviates from this approach, it requires a lengthy defense. See, for example faculty.wcas.northwestern.edu/~cfm754/actualist_rationality.pdf | |
| Dec 31, 2010 at 22:29 | comment | added | Qiaochu Yuan | @JSE: huh. I have to disagree with the example; he's not even using a nontrivial utility function. Whether I choose the first or second option depends heavily on whether these are the last 500 remaining humans, as far as I know. If they are, then I would act to minimize risk, not to maximize expected value, because my utility function would be heavily biased against the total extinction of humanity. | |
| Dec 31, 2010 at 21:43 | comment | added | JSE | By the way, Qiaochu, there are totally people who really believe in maximizing EV at any expense! See e.g. the "shut up and multiply" school around the blog Less Wrong. lesswrong.com/lw/n3/circular_altruism | |
| Dec 31, 2010 at 21:41 | answer | added | JSE | timeline score: 8 | |
| Dec 31, 2010 at 19:23 | answer | added | Martin M. W. | timeline score: 1 | |
| Dec 31, 2010 at 16:55 | answer | added | Steven Landsburg | timeline score: 2 | |
| Dec 31, 2010 at 15:57 | answer | added | Jason | timeline score: 0 | |
| Dec 31, 2010 at 15:06 | comment | added | Gjergji Zaimi | Related en.wikipedia.org/wiki/Gambler%27s_fallacy I am having trouble seeing this as a mathematical question. | |
| Dec 31, 2010 at 15:03 | comment | added | David Harris | For example, there is an article today on slate.com about PowerBall lotteries which makes this claim (and explicitly justifies it in terms of the law of large numbers, although it does not use this termonology) | |
| Dec 31, 2010 at 14:50 | answer | added | optima | timeline score: 0 | |
| Dec 31, 2010 at 14:42 | comment | added | Qiaochu Yuan | I have never seen anyone seriously claim this. Do you have a reference? | |
| Dec 31, 2010 at 14:39 | history | asked | David Harris | CC BY-SA 2.5 |