Jun. 24th, 2017

mtbc: photograph of me (Default)
Money is well-known to have a non-linear utility function. For example, from my position I would gladly trade a ⅓ chance of winning $20m for a ⅔ chance of winning $5m. What I have not thought through clearly is the effect on lottery tickets: can it make sense to buy only one ticket or, if it is worth buying any at all, is it likely that buying a few would make even more sense?

On the one hand, if running a lottery is profitable and the utility of money decreases the more I win then that might argue for never buying lottery tickets: the ticket cost is worth too much to me. But, the procedure by which unwon jackpots commonly roll over might make ticket-buying make sense at least for linear utility if the number of tickets purchased does not increase proportionally to the larger jackpot. Can rollovers ever make it rational to buy a bunch of tickets? Perhaps the non-linearity is always enough to scotch even that idea.
mtbc: maze B (white-black)
I noticed that in household conversations we give odd names to some of our foods. For instance, today I bought butter. Our butter dish has the outward appearance of a ceramic hedgehog. So, to refer to butter from the block in the dish we speak of hedgehog butter. Or, the connection may be looser: for example, we eat Star Wars cheese: comparevisual styles. ) In their attempts at specificity I wonder what names other families come up with. In that latter case, perhaps the same as we have.

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mtbc: photograph of me (Default)
Mark T. B. Carroll

July 2017

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