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CronoDAS comments on If there was one element of statistical literacy that you could magically implant in every head, what would it be? - Less Wrong
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Comments (67)
If you offered me the choice of two "lottery tickets", one of which paid $30 if it rained tomorrow and one of which paid $70 if it didn't, I wouldn't care which one I took.
That surely can't be the right general answer, because the relationship between your attitude to getting $30 and to getting $70 will depend on your wealth now. (And also on your tolerance for risk, but you might be willing to argue that risk aversion is always irrational except in so far as it derives from diminishing marginal utility.)
You could switch from dollars to utilons, but then I think you have a different problem: we don't have direct access to our utility functions, and I think the best techniques for figuring them out depend on probability, which is going to lead to trouble if probabilities are defined in terms of utilities.
My question was about the probability of rain, not about what you would be willing to bet on. Besides, who's that "me", a perfect rational Homo Economicus or a real person? Offering bets to an idealized concept seems like an iffy idea :-)