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ConorOberstIsGo
1060344.  Tue Mar 04, 2014 10:18 am Reply with quote

knightmare wrote:

Quote:
"The wise choice would be to gamble to begin with"


So the unwise choice is supposed to be to receive GBP 3000, free-of-risks.


Okay the idea is that if you play five times with the riskier strategy you average 16000 but if you play five times with the non-gamble you average 15000. Even though you are not being asked over and over, the logic still applies.

The second question results in the same numbers but this time as losses.

From a purely rational mathematical perspective, even as single events (i.e. you don't play over and over) purely looking at pay-offs and not knowing that the second question is going to be asked (yes, this is exactly why I asked 'your decision?' at each stage in the exercise!), most people choose strategies that would make them worse off overall.

................................................
Somewhat unrelated is the Gambler's Fallacy and the tendency of gamblers to engage in riskier bets after they have lost a lot. People might think that casinos like to hope you'll win a few times and then get greedy and lose it all and then some. In fact most compelling casino bets (and activities like computer games) often have their marks (players) fail the vast majority of the time. To elicit compulsive behaviour in animals and humans, the best reward strategy is a Variable Ratio Reward*; you succeed about 1 in 10 times but not every tenth time. I don't know what it is about us that causes us to want to play a game (or work so hard at something) we know is so heavily dependent on chance.... but there you have it.

Quote:
The variable ratio schedule produces both the highest rate of responding and the greatest resistance to extinction (for example, the behavior of gamblers at slot machines).
http://en.wikipedia.org/wiki/Reinforcement

 
knightmare
1060474.  Tue Mar 04, 2014 4:37 pm Reply with quote

Loss aversion without insurance aversion, and so on:

Option 1: wait. Risk: manually operated railroad crossing, often having to wait over an hour for 0-2 trains.



Option 2: don't wait there. Cycle 1.5 minutes, wait 0.5 minutes (average) for a train. Risk: option 1 wins.

Option 1 was quite popular, with complaining people in a queue willing to wait 60+ minutes (i.e. desperately hoping it's their lucky day) to cross the railroad. Hardly anybody (almost nobody) changed their mind, despite of the terror.

 
ConorOberstIsGo
1060485.  Tue Mar 04, 2014 5:41 pm Reply with quote

knightmare wrote:
Hardly anybody (almost nobody) changed their mind, despite of the terror.


Now that I like so I'm going to have a look into it. Thank you KM :)

 
knightmare
1060494.  Tue Mar 04, 2014 6:48 pm Reply with quote

Quote:
Quote:
Hardly anybody (almost nobody) changed their mind, despite of the terror.


Now that I like so I'm going to have a look into it. Thank you KM :)


This railroad crossing is finally replaced by a tunnel. I tried to find a video, a comedy show fast-forwarded it to count 2 trains while people waited over 60 minutes. A common event.

Other videos:

Option 1, manually operated, please note you still have to wait after you've seen the train. Time to wait: ???
Option 2, I think. It's busy, but on average this is the smarter solution by far.

This manually operated railroad crossing, a few miles away, isn't that bad, but it shows the problem. It's almost a game to guess how long it will take before you see the first train. Waiting... Still waiting... I stick with my choice... Waiting... Finally, a first train: 2:47 minutes. Waiting... Still waiting... Delay more than 5 minutes... 5:27 minutes, a second train. Waiting... Waiting... Thank you, operator!

 
knightmare
1060496.  Tue Mar 04, 2014 7:18 pm Reply with quote

Quote:
Okay the idea is that if you play five times with the riskier strategy you average 16000 but if you play five times with the non-gamble you average 15000. Even though you are not being asked over and over, the logic still applies.


Not if you can play the game just once (like me needing home insurance when I can afford just one house). When you reversed the game, so we had to pay you, the smart logic was reversed too: it's a scheme to make 3200 instead of 3000.

The railroad crossing is a better example, because it doesn't introduce an unusual game nor insurance. Everybody knows the "famous" grote spoorbomen, the shortest route, were doomed, but people sticked to their default choice and didn't drive to the kleine spoorbomen. Perhaps people also assumed that a lot of waiting people meant they'll get lucky soon. Suckers...

Of course the smart choice was to check out option 1, you can see and hear option 2 down the road, and use option 2 unless you have a reason to gamble and use option 1. On an average day that would easily save you at least 10 minutes of waiting for a manual operator with a remote controlled toy.

 
gruff5
1060501.  Tue Mar 04, 2014 8:59 pm Reply with quote

I myself am not scared of flying, but I respect the "logic" of those people who are - flying in an airliner should scare everyone - no matter the statistics, which are always repeated as if those who are scared had never heard them before.

 
Pangerio
1060504.  Wed Mar 05, 2014 3:26 am Reply with quote

I have recently finished reading Thinking, Fast and Slow, which discusses in some detail what ConorOberstIsGo is on about.

The stuff in the book made a lot of sense, but am having a hard time following ConorOberstIsGo here, even though I know what the gist of his argument is (or is meant to be).

 
knightmare
1062701.  Tue Mar 11, 2014 5:45 am Reply with quote

It does get better, albeit I couldn't find some Kopspijkers video of the former railroad crossing (option 1).

Option 1b: there used to be a bridge, so pedestrians could avoid the problem. Many losers don't want to be losers twice (option 1 wins, while they are trying option 2), so they're sticking with their doomed choice. A heater was installed because of the extreme delays.



Option 2b: there used to be a tunnel here, so the risk of losing twice was reduced.

A lot of options, but still a lot of people waiting with their bicycles.

 
eggshaped
1337765.  Fri Nov 29, 2019 4:56 pm Reply with quote

According to this study, the smarter you are, the more likely you are to fall for the gambler's fallacy.

https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0047019

 

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