Hello, Welcome to Known Unknowns, a newsletter that, despite all evidence to the contrary, still thinks that people are rational risk-takers. Risky choices I’ve always taken a heterodox view with regards to risk-taking. I’ve never believed that everyone is teeming with biases and are incapable of understanding probabilities or ambiguity. When economists say that someone is irrational, they usually mean that they are simply inconsistent. Or, when faced with a risky choice, that they’ll behave one way in one circumstance, and then make a totally different choice once things change. Like betting differently on the exact same poker hand, depending on whether you’re up or down in money.
Known Unknowns
Known Unknowns
Known Unknowns
Hello, Welcome to Known Unknowns, a newsletter that, despite all evidence to the contrary, still thinks that people are rational risk-takers. Risky choices I’ve always taken a heterodox view with regards to risk-taking. I’ve never believed that everyone is teeming with biases and are incapable of understanding probabilities or ambiguity. When economists say that someone is irrational, they usually mean that they are simply inconsistent. Or, when faced with a risky choice, that they’ll behave one way in one circumstance, and then make a totally different choice once things change. Like betting differently on the exact same poker hand, depending on whether you’re up or down in money.