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ChristianKl comments on Stupid Questions, 2nd half of December - Less Wrong Discussion

2 Post author: Bound_up 23 December 2015 05:31AM

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Comment author: ChristianKl 12 January 2016 10:31:12PM 1 point [-]

In general, when you are asked "What is the probability that the coin came up heads" we interpret this as "how much are you willing to pay for a contract that will be worth 1 dollar if the coin came up heads, and nothing if it came up tails"

Nobody who thinks that the probability is at 75% will buy into the prediction market when the prediction market is at 75%.

A better way to phrase it would be to say: "If you are forced to buy a share in the prediction market, the probability of the event is that probability where you don't care which side of the bet you take."

Comment author: Anders_H 12 January 2016 10:34:27PM *  0 points [-]

Sure, this is true, thanks for noticing. Sorry about the inaccurate/incorrect wording. It does however not affect the main idea.

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