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Lumifer comments on Open thread, Nov. 24 - Nov. 30, 2014 - Less Wrong Discussion

4 Post author: MrMind 24 November 2014 08:56AM

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Comment author: Lumifer 25 November 2014 09:56:36PM 0 points [-]

Any decision made implies a combination of prior over those values and risk tolerance.

If you treat budgeting as an optimization problem, you need forecasts, not priors.

I would also suspect that real-life business budgets will be hard to set as "rigorous optimization problems" because in reality you have discontinuities, nonlinear responses, and all kinds of funky dependencies between different parts of the budget.