literally, as in Keynes’ (1936) phrase, taking into account “what average opinion expects the average opinion to be.”
page 46
…perfect rationality in the market cannot be well defined. Infinitely intelligent agents cannot form expectations in a determinate way.
This type of behavior–coming up with appropriate hypothetical models to act upon, strengthening confidence in those that are validated, and discarding those that are not–is called inductive reasoning.
page 47
We see immediately that the market possesses a psychology. We define this as the collection of market hypotheses, or expectational models or mental beliefs, that are being acted upon at a given time.
page 48
the first(?) mention of a genetic model in the book
Chapter 2 is a nice piece on the El Farol Problem which is a paradox which “represented a decision problem where expectations (forecasts) that many would attend [the El Farol bar] would lead to few attending, and expectations that few would attend would lead to many attending: expectations would lead to outcomes that would negate these expectations.”
Zhang and Challet generalized this problem into the Minority Game in game theoretic form.
Page 31:
There are two reasons for perfect or deductive rationality to break down under complication. The obvious one is that beyond a certain level of of complexity human logical capacity ceases to cope–human rationality is bounded. The other is that in interactive situations of complication, agents cannot rely upon the other agents they are dealing with to behave under perfect rationality, and so they are forced to guess their behavior. This lands them in a world of subjective beliefs and subjective beliefs about subjective beliefs. Objective, well-defined, shared assumptions then cease to apply. In turn, rational, deductive reasoning (deriving a conclusion by perfect logical processes from well-defined premises) itself cannot apply. The problem becomes ill-defined.
This passage, though in an economics text, seems to be a perfect statement about part of the problem of governing in the United States at the moment. I have a thesis that Donald Trump is a system 1 thinker and is generally incapable of system 2 level thought, thus he has no ability to discern the overall complexity of the situations in which he finds himself (or in which the United States finds itself). As a result, he’s unable to effectively lead. From a complexity and game theoretic standpoint, he feels he’s able to perfectly play and win any game. His problem is that he feels like he’s playing tic-tac-toe, while many see at least a game as complex as checkers. In reality, he’s playing a game far more complex than either chess or go.
The overall problem laid out in this chapter is an interesting one vis-a-vis the issues many restaurant startups face, particularly in large cities. How can they best maximize their attendance not only presently, but in the long term while staying afloat in very crowded market places.
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The level at which humans can apply perfect rationality is surprisingly modest. Yet it has not been clear how to deal with imperfect or bounded rationality.
Chapter 3 takes a similar problem as Chapter 2 and ups the complexity of the problem somewhat substantially. While I understand that at the time these problems may have seemed cutting edge and incomprehensible to most, I find myself wondering how they didn’t see it all from the beginning.
The structure of the book is a bit like stone fruit, with a soft wrapping of a hard core, …
Transfer entropy is hard to calculate from real data.
I love that they provide a “List of Key Ideas”, a “List of Open Research Questions”, and a “List of Key Results” in the opening along with the traditional sections of symbols used, acronyms, list of tables, etc. More texts of all stripes should be doing this!
The first ever WordCamp for Publishers will be held August 17-19 in Denver, Colorado. The niche WordCamp will be open to anyone who uses WordPress to manage a publication, no matter what size. Orga…
Automattic is hosting a free, remote conference called Design and Exclusion on April 21. The event will bring together design and technology experts who will discuss solutions for the ways that dig…
A common frustration I’ve experienced in WordPress after installing a plugin is figuring out where the settings link is located. It can be a top-level menu item or tucked away in a sub-menu. …
The biggest change happened that same year, in March, when a new dictionary, the second edition of the Official Tournament and Club Word List, took effect. This edition christened QI and ZA as valid Scrabble words in North American play, along with FE, KI, OI and an additional 11,000-odd longer words. Two-letter words are the building blocks of Scrabble’s DNA, and the Q and Z are juicy high-point tiles — so the game evolved instantly.1 You can see that in the data set I created by scraping over 1.5 million tournament games covering the years 1973 to 2017 from cross-tables.com, an online clearinghouse for Scrabble tournament results. After the new dictionary hit the scene, the average score grew by about 10 points per player per game overnight. (The average score in the data set is about 374.)2
In keeping with the IndieWeb concept of POSSE (Publishing on my Own Site, Syndicating Elsewhere), I try to make social media posts on my own site first and then make similar (not always identical!) posts to my accounts on silos like Twitter and Facebook. I then add links to the posts on my site indicating that you can find the "syndicated copies" of that post on those silos.
Unless you've been living under a rock (or just very much removed from social media, in which case, I applaud you for going to a place I never will), then the concept of "woke" being used as an adjective is not a particularly new thing for you. As…
CreditIllustration by Yann Kebbi Barrier Status: 'none'
Hard times for Muppets! Sad! Me think unemployment not easy for puppet with addiction issues. Me find unemployment very triggering. Me want to ask government, “Who is real monster here?”
Colleagues bad now, too. Elmo spiral into depression and eat his goldfish, Dorothy. Pepé the King Prawn worry about deportation. Miss Piggy now glorified geisha, forced to be active listener. Only good thing is most of us newly politicized. Me is totally woke. Use new free time to rally colleagues and to dialogue. Camaraderie good! Camaraderie powerful! During long hours together in unemployment line, you can really get deep, you can really go beyond the felt.
What strange to Muppet community is Muppets always like Donald Trump. Donald Trump always somehow seem like kindred spirit. Donald Trump seem like slightly more organized Fraggle. Yes, in nineteen-eighties, on “Sesame Street,” Ronald Grump character built tower of trash cans on Oscar’s turf. Yes, other time, on special, Joe Pesci play Ronald Grump and spit on Elmo. But mocking was gentle. Mocking gentle, and plus we give lots airtime. Donald Trump like airtime. Airtime is hair time. The letter “H”!
Me trying to transition into this new life chapter with grace. Me trying to find bright side: no more pledge drives, no more feeling old when realize all favorite TV shows are sponsored by river cruises. But sometimes cloud come over me in afternoon. Cloud of realization. Cloud of sad. More reflective now. Time makes puppets of us all. Bad!
Me talk to agent about possible second career as recording artist, because me often mistaken for gravel-voiced singer Tom Waits. Me think me has everything Tom Waits has, plus me is blue. Sad songs from blue person, very good, very meta. Agent laugh. Agent say more realistic direction is recovery memoir and TED talk. Agent say more realistic direction is therapy pet who visit hospitals—“Make-A-Wish but the meter is running, hon.” Agent also say that he get call about Cookie working as kind of Swiffer—some company want Cookie as a “electrostatic stanching shammy.” Now me laugh. Me think contemporary consumerism like virus that eat brain. Me unclear about meaning of “electrostatic stanching shammy,” but me pretty sure it mean rag.
So. Me trying to be big. Me trying to reap benefits of talk therapy. Therapist point out that Cookie strong because Cookie weathered changing attitudes about eating. Therapist talk about time, in 2005, when show had Hoots the Owl sing “A Cookie Is a Sometime Food.” Stupid song. Stupid song suggesting me had no jurisdiction or agency over throbbing id. That song the beginning of the end. That the singing on the wall. Me not like that song! That song just another unseen hand reaching up the Cookie ying-yang.
Now this new government hand. It not nice like Frank Oz hand. Frank Oz smell good, have light touch. Government hand rough, like that of teen-age boy. So now me take only route available: me wage cookie hunger strike. Me get Hoots the Owl to do duet of new song, “Bye-Bye, Biscotti.” Me get outside consulting firm to create slogan: “Nom, Nom NO.” Me tell world that “C” is not for cookie, “C” is for cauterize the wound that is direct result of rapacious governing. Me get sympathetic People cover in manner of survivor of rare disease.
Meanwhile, me send message to Washington via quiet assertion of strength. Me remind government that Cookie Monster have no eyelids. Me remind government that Cookie Monster always watching. ♦
Marty McGuire
Peter Wilson