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Unknowns comments on Justifying Induction - Less Wrong
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The only reason that I'm using it is because in real life we update more than once.
But if you want to focus on the single update, yes, both hypotheses become more probable.
Maybe an important insight into why the justification of induction remains so puzzling. We should be justifying induction as a policy, not as a magic-bullet formula which works in each and every instance.