Vaniver comments on What's the Value of Information? - Less Wrong

10 Post author: johnlawrenceaspden 29 August 2012 04:20PM

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Comment author: Vaniver 30 August 2012 07:52:58PM *  4 points [-]

orthonormal's making the more subtle point that decisions are binary, and so certainty is crudely partitioned into two regions. With hedging and other financial instruments, then relative degrees of certainty matter- if I'm 90% sure that it's 1d12 and you're 80% sure that it's 1d12, then we can bet against each other, each thinking that we're picking up free money. (Suppose you pay me $3 if it's 1d12, and I pay you $17 if it's 2d6. Both of us have an expected value of $1 from this bet.) The more accurate my estimate is, the better odds I can make.

With the decision problem, we both decide the same way, and will both win or lose together.