Friday, July 25, 2008

The Metaphor of Mean-Variance

Sitting on the beach with a friend, we discussed the eternal topic of how much beauty one should look for. It is known that for the same "price" you will get either more beautiful and less smart and vice versa. Those with beauty and wits, will look for a higher quality lad than you.

Friend says that everyone looks for different kinds of beauty.
But there is a common element!

There is no contradiction. If you ask different people to rate beauty, you will find some correlation between them.
Common element + individual/deviant element.

Mean-variance is very relevant to every knowledge. All we know is partial, and depends on conditions (the correlation between the beauty in my eyes an African man is lower than between me and other Israelis, I guess. But there also there is a strong correlation! again. three quantities: common to all, more common for Israelis alone, and variable). It can go on...


Intuition can be true. However, without thinking it out, we suspect it a little. Its reliability is probabilistic (any knowledge is probabilistic. Anyone not understanding it should see a doctor). On average ("mean") it has certain chance to be right, but a good probability to be a mistake = unknown


Many controversies come about because of not understanding. Evidence to an effect does not say it is exclusive, and the same for counter examples. Many counter examples disprove just the generality of the rule, there may still be a partial generality (sometimes a generality is dependent on various conditions and other problems. Long story).


The mind does not like half truths, continuous gradients of stuff, etc.
Baumeister (the cultural animal) explains: Most decisions and actions in life are discreet. You either order the cake or not. tell the joke or.... tell first three words and see reactions.... (this is the continuous way, but most do not use it). Our mind May have a adapted to this reality.
Simplification of information is another reason. I surmise that both explanations are right.


PS. To make Nassim Taleb happy, I state that variance can be a crazy distribution/fractal/unknown/jumpy or whatever. In another sense, the idea of mean and variance above, reflects the idea of commonalities between things, while there are differences and possibly big ones. Sorry reader. It is not me complicating matters. It is reality that is opaque making our minds dizzy.

Jump to achieve/change

Our options are limited. We try to choose the best one (assume).

But we can create new interesting options.
For me, driving involves so much effort, that having a car is useless. But if I engage in driving for a long time, driving will become automatic. Then having a car may improve my life.

There are endless ways we can have better options by engaging a certain amount of negative/effortful experience.
Those endless possibilities do not occur naturally. They occur only when you forget everything you know about your own

life and experience. Questioning even the smallest basic assumption about how you feel, function, mind working, wants, etc.
Beware, that even with much effort, you will see only a minority of hidden options in your life. The scope of potential

possibilities is never seen fully.

Consider:

1) Over optimism. We expect life to get better after the change becoming natural. We are usually overestimating the

expected improvement. We may not learn the skill/get used to the situation. The very usefulness of the learned stuff can be illusory. Adaptation, that is human's tendency to get used to everything, cancels out various supposedly improvements of life.

2) Gamble. Skewed bets (like lottery, but with maybe positive expectation). Sometimes, the cost is relatively low, but the possible progress is enormous. No big loss if useless. But the change in life can be forever. Other changes to life are long investment, but small improvement for a little while only.
Life is short!


A change starts negatively, where we lose immediately from it. The trick is that sometimes, the later value is large. The farther the positive value, the larger the effort invested, the less worth it seems to be.

Hidden options are endless. It is a complex territory, sometimes worth the trouble.

Saturday, July 12, 2008

Darwin's Epistemological insight: Unreliability of probabilities.

What are the probabilities of our existence?

OK. There could have been many "existence" so the question should be asked "what is the probability of an existence that is 'interesting'" or something like that.

Technically, we cannot calculate, because we have no knowledge about the variety of processes that could have happen.
But we may try intuitively, with some understanding of the space of possibilities, to gauge. Where are the odds going to land?

In short, I see that it feels that the probability is very low. Not 1 / 1 ^ infinite zeros. But rather 1 / 1 ^ very many zeros.

Darwin killed 99.9999% of the improbability of existence.

But I believe, that while we may (and have to) intuit about these probabilities, we should learn from this experience is how far our estimates can be from the ultimate numbers.

Before Darwin, if asked what are the odds for this world, reply would be infinitely low. Because the probabilities for all these species and their complexity and efficiency is so impossible.

One good algorithm of Darwin (gradual process of evolutionary selection) dumped the probabilities infinitely. They still seem low, but in relation to the odds we had before Darwin, the odds are infinitely more probable.


Statistically, Darwin taught us how a not thought of process can change dramatically our subjective probability assessments.


We Know that our estimates are terribly unreliable. That is, after Darwin

Epistemologically, that is Darwin's most important lesson!

Monday, June 30, 2008

The problem of being gifted

Geniuses are able to invent explanations on all fronts with no apparent difficulty. When those guys come up with a nice theory, be skeptic. They have the capability of making up endless kinds of theories explanation and combinations thereof. That is a big problem.

Saturday, June 28, 2008

Tricking conflicting wants

Much of trouble we face comes from the fact the many of our wants are confliting with each other [1: examles].

Some of these are unavoidable in a complex reality whihc is not built to fulfill our wants.
Other conflicts are only apparant conflicts. They arise because in the default state of things they are conflicting. But there are ways around.

Finding ways around conflicts (i.e. learning how to eat the cake and have it, too) may hold a big promise to improve lfie quality. I would guess that people just do not explore all space of ways to put things together.

Caveat: I may prove wrong. THnking too much, tricking things, etc., and getting used to eat the cake etc. may prove negative on balance. I hope I am right.


[1: examples] Baumeister holds that over half of self-defeating behavriors are actually trade-offs. Alcohol abuse come from wanting the joy of alcohol but neglecting the consequences. and so on.

There are more examples, whihc I may add later.

Three degrees of rationality in Economics

I believe that economical decisions can be roughly divided into three levels with rationality decreasing: Outside arbitrage. Big consequences. Small consequences.

1) Outside arbitrage. Where a few rational individuals can make money out of other’s inconsistencies. Example put/call parity in options.Here the market is almost always rational. Because it is enough to have very few rational guys to rationalize it. These rationalizing the market should be have an interest in rationalizing the market. E.g. making money of other's irrationality

2) Big consequences refers to where irrational decisions are going to be exposed no matter how careless people are. Example: The very idea of saving for pension.
While single individuals ignore saving many times, there is public awareness to the need, and society makes an effort to rationalize behavior.Other examples relate to financial decisions that many people know they have to consult about. The big consequences ultimately insert rationality in the system, via various routes.

3) Small things. Here I see no doubt that human nature is quite capricious. There are so many examples about this.

I believe that rejecting an even chance bet of winning 200 and losing 100 is strictly irrational. Many reject such a gamble. But this is a small decision. The direct consequences of this irrationality are not that big to make society aware on them.

I never saw this distinction written, but it looks obvious. Anyone saw these definitions stated somewhere?

PS. Definition of small/big
When I talk about big decisions, I am not talking about the effect of the decision itself. I am sure people make irrational decisions about huge decisions.
My category of “big” talks about mistakes that are repeated many times, and their effect is disastrous. This may lead to correction from various places. Not taxing car entrance to the city centers can be said irrational, and one city at least reacted, while other tried. It can be seen that rationality emerges when the effects are severe enough. Even then rationality does not rule.

Thursday, April 3, 2008

A very personal approach about finding a partner

A very personal approach about finding a partner
"personal" because of the sophistication problem. Sophisticated stretegies are very risky and can be a great way to fool oneself to rationalize the most stupid decisions. beaware!

1) "so-so" relationships are mediocore and bad. (see detailed sources for that at the end) I am not looking for these (except for the short-term to manage day to day emotionally)


2) goal = really good relationship.


3) skewed bets strategy. Crucial for finding a mate.

3.1) payoff is skewed. cost of a cheap try is uncomparable to value of finding something good.

3.2) must keep bettting costs low. You are not hanging out for weeks with every possible mate. You make a quick check, maybe an enjoyable date and think whether there is a chance for the really impressive thing. If you get dragged into every bet you cannot accumulate bets. and the betting costs get heeavy on your budget (energy time etc.)

3.3) Be humanistic with the people you gamble about. The innocent girl in the station should not suffer because of your sophisticated gambles. Do not make others suffer in the process. Eventually, you will find the process much more successful and joyful when being considerate.

3.4) "If you look for rare and moving elephants you should always carry a gun" (Beloved Warren Buffet). checking for a rer opportunity involves the mindset of being able to move the wheel 180 degrees and pul the engine fast when an opportunity arises. If you see something with a good probability for a lifetime success you should be able to pursue it strongly at any time with needing ltos of preperation "the right time for dating" etc. etc. You can even do maximum effort to find someone who feels to be a really good bet.

3.5) It is so expected that finding a good match requires lots of checking. Because there is a lot of personal variability tastes and different valuing of different qualities. there are mates who will value your qualities much more than others, and those are the folks you should look for. If you look for getting your "self"s worth.
This try a lot is a strategy that is irrationaly underrated in dating. I know many that could have get good things just by rying enough. So many just do not invest in trying. It is either because they forget about skewness, ignoring a bet that is less than 50% chance. Or because of paying dearly for every gamble, which in exhausting.


4) Looking for the really good thing (aka "no cap strategy") means that it may take a long time to find. It implies one must have short-term solutions/alternatives in terms of emotional social needs and maybe sexuality. If you feel desperate you 1: feel bad, AND 2: you tend to get dragged into mediocre relationships. Must have social network enough to keep "above the water".

Note. 1: all we have in real life here and now is the short-term, so working out short-term solutions is highly important. 2: In western soceities most spent long years without a "serious" mate, so short-term tricks etc. are crucial to have a good life.


So-so relationships are bad. because:
you lose the option of getting a really good relationship.
according to a happiness research that tracked people over many years, the average married person is not much happier than the single in the long run. But there is a subgroup of really happy marriages that make people happy for the really long term. Such kind of marriage you should be looking for, not the one that is hardly better than being single.
Getting stuck in a bad relationship and divorcing is much worse for happiness than what the averegae marriage is making happy. I am not sure it is worthwhile on balance. Moreover, looking at the long term data I realized that the overall expected value of marriage in happiness terms is slightly negative. When one starts a gamble (i.e. a relationship, whihc is always kind of gamble) he shoulod look for positive expected value when all possible eventualities are summed up.
a relationship involves investing quite a bit. I am strongly against investing energy etc. for getting almost the same overally. I am only for good deals. Against all kind of mediocre deals where you are struggling to convince yourself it is worthy.


Additional reading
1) John Gottman made extremely intereting research on relationships. His idea is that somehow there are a few very simple positive dynamics that make good relationships work. He manage to predict with 90% accuracy which couples will remain together 15 years in advance!!!!!, a prediciton that was based on analyzing a 15 minutes chat between the couple.
His stuff is surely worth reading, and using. One may even try to think about his relationships via Gottman glasses, maybe knowing more in advance can help avoid much painful mistakes.

2) The book "Simple Heuristics that make us smart" contains a chapter descussing the optimal rules for mate searching. I have not studied this chapter seriousely, but the book it good, and the idea of a rule of thumb in mate finding is appalling.