<HTML><BODY>From: stepjak@yahoo.fr<br>
> --- raphfrk@netscape.net a écrit :<br>
> > A voter might be willing to use option C even though D gives a better<br>
> > expected value.<br>
><br>
> In my opinion, if the voter prefers to vote option C than option D,<br>
> because he doesn't want to risk the -1 outcome, then he has not<br>
> correctly estimated that value as being -1.<br>
<br>
I guess it depends on how you define it. However, the example often given<br>
is which would you prefer?<br>
<br>
51% chance of getting $200<br>
100% chance of getting $100<br>
<br>
Risk aversion is a known economic effect.<br>
<br>
It only happens when you are talking about a major portion of a person's<br>
wealth.<br>
<br>
> Do feel this is a big problem? I have seen more concern that voters<br>
> will vote the opposite way: Commit to a favorite candidate and cut<br>
> off any chance of even electing the second favorite.<br>
<br>
No, I don't think this is a problem. In fact, having voters who<br>
don't vote in the extremes can help smooth out election results,<br>
so they don't jump between two very different results.<br>
<br>
I was trying to give a rationality for people not using maximally<br>
strategic votes.<br>
<br>
><br>
> > The example given was:<br>
> ><br>
> > Assuming that you start with $1 and can place a bet on a fair coin. If<br>
> > you win, you get 1.05 times your stake (and your stake back). You get to<br>
> > repeat the gamble as often as you want, but can only use your initial<br>
> > stake and any money you win.<br>
> ><br>
> > What is the optimal amount to bet in order to <span class="correction" id="">maximise</span> the rate of<br>
> > income. Clearly, if you bet all your money you will with near certainty<br>
> > be bankrupt after say, 10 rounds.<br>
><br>
> I'm pretty sure you'd want to place a lot of very small bets. Do you<br>
> have the answer?<br>
><br>
<br>
Yeah, you would try to max the log of the expected result.<br>
<br>
This works out at betting <span class="correction" id="">approx</span><br>
<br>
0.5*(1 - 1/(g))<br>
<br>
where g is the gain for winning (1.05)<br>
<br>
This works out in the example above of 0.0238 times your total.<br>
<br>
Betting anything higher than that gets exponentially more risky.<br>
<br>
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