I prefer B to A does not imply I prefer 10B to 10A, or even I prefer 2B to 2A. Expected utility != expected return.
I agree pretty much completely with Silas. If you want to prove that people are money pumps, you need to actually get a random sample of people and then actually pump money out of them. You can’t just take a single-shot hypothetical and extrapolate to other hypotheticals when the whole issue is how people deal with the variability of returns.
“I prefer B to A does not imply I prefer 10B to 10A, or even I prefer 2B to 2A. Expected utility != expected return.”
Of course, but, as I’ve said (I think?) five times now, you never actually get 2B or 2A at any point during the money-pumping process. You go from A, to B, to nothing, to A, to B… etc.
For examples of Vegas gamblers actually having money pumped out of them, see The Construction of Preference by Sarah Lichtenstein and Paul Slovic.
Strictly speaking, Eliezer’s formulation of the Allais Paradox is not the one that has been experimentally tested. I believe a similar money pump can be implemented for the canonical version, however—and Zut Allais! shows that people can be turned into money pumps in other situations.
I prefer B to A does not imply I prefer 10B to 10A, or even I prefer 2B to 2A. Expected utility != expected return.
I agree pretty much completely with Silas. If you want to prove that people are money pumps, you need to actually get a random sample of people and then actually pump money out of them. You can’t just take a single-shot hypothetical and extrapolate to other hypotheticals when the whole issue is how people deal with the variability of returns.
“I prefer B to A does not imply I prefer 10B to 10A, or even I prefer 2B to 2A. Expected utility != expected return.”
Of course, but, as I’ve said (I think?) five times now, you never actually get 2B or 2A at any point during the money-pumping process. You go from A, to B, to nothing, to A, to B… etc.
For examples of Vegas gamblers actually having money pumped out of them, see The Construction of Preference by Sarah Lichtenstein and Paul Slovic.
Strictly speaking, Eliezer’s formulation of the Allais Paradox is not the one that has been experimentally tested. I believe a similar money pump can be implemented for the canonical version, however—and Zut Allais! shows that people can be turned into money pumps in other situations.