Scottish non-independence prediction markets

Posted on September 8, 2014 by F. E. Guerra-Pujol

The Scottish Independence Referendum is scheduled to take place on 18 September 2014. Some survey polls put the “Yes” vote (in favor of Scottish Independence) at 51%. Prediction markets, by contrast, are less sanguine (see tweet above) about a pro-independence victory. What gives? On another note, shouldn’t tradition and the 1707 Acts of Union count for something? Shouldn’t the “Yes” vote require at least a two-thirds super-majority, not a simple majority? (Hat tip, again, to the amazing Tyler Cowen.)

Posted in Bayesian Reasoning, Current Affairs, Politics, Voting | Tagged | Leave a comment

Does Amazon make a profit?

Posted on September 7, 2014 by F. E. Guerra-Pujol

According to this economic analysis of Amazon’s business model by Benedict Evans, the answer is “not yet” … because Jeff Bezos has adopted a “closed-loop” strategy of re-investing all of Amazon’s revenues back into his company in order “to capture a larger and larger share of the future of commerce.” Here is one revealing excerpt from Ben Evans’s essay (with thanks to Tyler Cowen for the pointer and Jeff Bezos for the diagram):

So, we have dozens of separate businesses within Amazon, and over two million third party seller accounts, all sitting on top of the Amazon fulfillment and commerce platform. Some of them are mature and profitable, and some are not. And someone at Amazon has the job of making sure that each quarter, this nets out to as close to zero as possible, at least as far as net income goes. That is, the problem with net income is that all it tells us is that every quarter, Amazon spends whatever’s left over to get the number to zero or thereabouts … If you listen closely, Amazon itself tells us this. The image below comes straight from Amazon — originally it was a napkin sketch by Jeff Bezos. Note that there’s no arrow pointing outwards labeled  ‘take profits.’ This is a closed loop.

(Source: Amazon)
Where’s the profit arrow?
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Trolley problems

Posted on September 6, 2014 by F. E. Guerra-Pujol

Here is the 34-word abstract of our latest paper, a work-in-progress with the title “Trolley Problems“:

This paper proposes a novel and probabilistic solution to the famous “trolley problem” in moral philosophy. In short, we would solve the trolley problem by conducting an auction from behind a veil of ignorance.

We have been thinking about trolley problems (there are at least two standard versions of the problem), off and on, since the summer of 2005. Our thinking has evolved during this time, and our paper will finally be published in the Drake Law Review Discourse this fall.

           What trolley?

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3 in blog years: Sept 3 is 3rd anniversary of errorstatistics.com

Posted on September 5, 2014 by F. E. Guerra-Pujol

prior probability is reblogging the post below and sending a belated “Happy Blog Birthday” in honor of Deborah G. Mayo’s “rag-tag amateur blog” (see below) Error Statistics Philosophy. Although we are currently residing in opposing philosophical camps–Dr Mayo takes a frequentist approach to science, while we aspire to be good Bayesians–we admire Dr Mayo’s work and follow her blog very closely. She always has something important AND non-trivial to say. What more could you ask of an academic colleague?

Mayo's avatarError Statistics Philosophy

Where did you hear this?  “Join me, if you will, for a little deep-water drilling, as I cast about on my isle of Elba.” Remember this and this? And this philosophical treatise on “moving blog day”? Oy, did I really write all this stuff?

http://errorstatistics.blogspot.com/2011/09/overheard-at-comedy-hour-at-bayesian_03.html cake baked by blog staff for 3 year anniversary of errorstatistics.com

I still see this as my rag-tag amateur blog. I never learned html and don’t have time to now. But the blog enterprise was more jocund and easy-going then–just an experiment, really, and a place to discuss our RMM papers. (And, of course, a home for error statistical philosophers-in-exile).

A blog table of contents for all three years will appear tomorrow.

Anyway, 2 representatives from Elba flew into NYC and  baked this cake in my never-used Chef’s oven (based on the cover/table of contents of EGEK 1996). We’ll be celebrating at A…

View original post 338 more words

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Is Apple’s iCloud a defective product?

Posted on September 4, 2014 by F. E. Guerra-Pujol

As a threshold matter, we would first have to determine whether Apple’s iCloud digital storage system is a “product” or a “service.” For the record, the answer to this key question is not obvious to us. Neither is it obvious to us whether this threshold issue poses a matter of law or a question of fact. (This second-order question is important because if we define this issue as a factual one, then a jury would get to decide this second-order question, not a judge.) Assuming, then, that a plaintiff’s lawyer could persuade a judge or jury that the iCloud system is a product, we would next have to determine whether this system was defectively designed or whether Apple provided adequate warnings of the dangers of using the iCloud system. But how do we determine whether iCloud was defectively designed or lacked adequate warnings? Let’s take the design defect issue first.  Continue reading →

Posted in Economics, Law | Tagged , , | 2 Comments

Supreme Court Selection Bias?

Posted on September 3, 2014 by F. E. Guerra-Pujol

Where do Supreme Court justices get their facts from? Oftentimes, they get their “facts” from amicus curiae legal briefs that are filed by “friends of the court,” i.e. private parties with axes to grind. Now, check out this fascinating report by Adam Liptak of the New York Times summing up Professor Alli Orr Larsen’s 57-page paper “The Trouble with Amicus Facts.” Here are a few egregious examples that appear in Liptak’s report: Continue reading →

Posted in Bayesian Reasoning, Deception, Law, Logical Fallacies | Tagged , | 1 Comment

“When should you show up to a party?”

Posted on September 2, 2014 by F. E. Guerra-Pujol

That is the key question posed in this fun essay by Walt Hickey, who now writes for FiveThirtyEight and who graduated from the College of William and Mary with a degree in applied mathematics. Here is an excerpt from Mr Hickey’s analysis:

Nobody wants to arrive too early. Being the first guest might mean you’ll catch the host before she’s done preparing … Nobody wants to be right on time, either. What if you don’t know the other punctual guests? What if you then have to meet new people and, God forbid, remember their names for the rest of the night …?

In other words, there is a “time trade-off” in deciding when to show up to a party. If you arrive too early, you run the risk of being bored or of finding yourself in a socially-awkward situation, but at the same time, if you arrive too late, you run the risk of offending your hosts and of losing out on the fun. There are no doubt other considerations that are relevant to this analysis, such as the number of invited guests, whether food is being served, etc. In any case, the larger point here is that there is an optimal arrival time. The question, however, is how do you calculate the optimal “late-arrival” time? (Hat tip to Mrs Andrea Robinson for the pointer.)

Too late or too early?

Posted in Bayesian Reasoning, Economics, Time | Tagged , | Leave a comment

Anti-constitutional moments?

Posted on September 1, 2014 by F. E. Guerra-Pujol

In our most recent paper, a work-in-progress titled “Gödel’s Interbellum,” we borrow Bruce Ackerman’s influential theory of “constitutional moments” in order to survey the major extra-constitutional events unfolding in Europe during the interwar period between World War I and World War II. Specifically, we expand on the idea of constitutional moments to embrace “anti-constitutional moments,” that is, moments when major political change occurs outside the constitutional process, such as military coups, putsches, states of emergencies, self-coups, and other unconstitutional seizures of power.

Moreover, as we explain in our paper, such anti-constitutional moments may have also played a role in Kurt Gödel’s purported discovery in late 1947 of a logical contradiction in the U.S. Constitution–what we have called “Gödel’s Loophole” in our previous paper with the same title. Continue reading →

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Do memes exist?

Posted on August 31, 2014 by F. E. Guerra-Pujol

To us, memes are like the luminiferous aether in Newtonian physics–a purely make-believe or hypothetical entity that does not really exist “out there” in space or time. In footnote 56 of our autobiographical essay, for example, we write:

… despite my general admiration* for [Richard] Dawkins, he and I completely part ways when it comes to “memes.” [*Note: I wrote these words before having read Dawkins’s dogmatic and intolerant screed The God Delusion.] Towards the end of his book [The Selfish Gene], Dawkins speculates about the spread of ideas and introduces the concept of memes in order to explain the evolution of human culture. In essence, Dawkins draws a crude analogy between memes and genes: if the evolution of living organisms is the product of changing gene frequencies over time, then the evolution of ideas must likewise be the result of the fierce competition among rival idea-memes … The problem with memes, however, is that they just plain and simple don’t exist—and pretending that they do is nothing but quackery on a par with astrology or alchemy. Memes are a fairy tale. They have no independent existence. They are unfalsifiable entities, like gods or boogie monsters.

We are by no means denying the existence of ideas. What we are denying is that ideas come in discrete packages called “memes.” After all, aside from simply offering conclusory statements positing the existence of memes, how would one test for their existence?

Where did all the luminiferous ether go?

Posted in Empty set, History, Philosophy, Science | Tagged , | 1 Comment

“What scientific idea is ready for retirement?”

Posted on August 30, 2014 by F. E. Guerra-Pujol

That’s the 2014 annual question posted on the website edge.org. (Previous Edge questions include “What is your dangerous idea?” (2006) and “What questions are you asking yourself?” (1998).) As we explain in our post of 8.31.14, we would retire Richard Dawkins’s evolutionary theory of memes.

What?

Posted in Philosophy, Science | Tagged , | 4 Comments