Source: David Friedman’s Substack

by David Friedman

“In principle, rational choice under uncertainty is straightforward — maximize expected utility. Doing this requires you to know both the probability and utility of all of the outcomes you are considering. Most of the time you don’t. The problem is particularly clear in the case of low probability high value outcomes. With a little googling I can get a pretty good estimate of the probability that it will rain today, with a little more of the probability that I will have a heart attack next year. Estimating the probability that, if I am an Alcor member and die I will be successfully frozen, preserved, and revived, is a harder problem, one that requires me to estimate the odds of winning a sequence of gambles …” (07/31/24)

https://daviddfriedman.substack.com/p/low-probability-gambles