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Yes. From the inside it can be very tough to tell, but from the outside they're clearly they're wrong about them all being low probability. They don't check for potential problems with the model before trusting it without reservation, and that causes them to be wrong a lot. Even if your "might as well be 100%" is actually 97% - which is extremely generous, you'll be wrong about these things on a regular basis. It's a separate question of what - if anything - to do about it, but I'm not going to declare that I know there's nothing for me to do about it until I'm equally sure of that.
I think one of the real big things that makes the answer feel like "no" is that even if you learn you're wrong, if you can't learn how you're wrong and in which direction to update even after thinking about it, then there's no real point in thinking about it. If you can't figure it out (or figure out that you can trust that you've figured it out) even when it's pointed out to you, then there's less point in listening. I think "I don't see what I can do here that would be helpful" often gets conflated with "it can't happen", and that's a mistake. The proper way to handle those doesn't involve actively calling them "zero". It involves calling them "not worth thinking about" and the like. There is nothing to be gained by writing false confidences in mental stone and much to be lost.
Right. With the lottery, you have more than a vague intuitive "very low odds" of winning. You have a model that precisely describes the probability of winning and you have a vague intuitive but well backed "practically certain" odds of your model being correct. If I were to ask "how do you know that your odds are negligible?" you'd have an answer because you've already been there. If I were to ask you "well how do you know that your model of how the lottery works is right?" you could answer that too because you've been there too. You know how you know how the lottery works. Winning the lottery may be a very big win, but the expected value of thinking about it further is still very low because you have detailed models and metamodels that put firm bounds on things.
At the end of the day, I'm completely comfortable saying "it is possible that it would be a very costly mistake to not think harder about whether winning the lottery might be doable or how I'd go about doing it if it were AND I'm not going to think about it harder because I have better things to do".
If I were gifted a lotto ticket and traded it for a burrito, I'd feel like it was a good trade. Even if the lottery ticket ended up winning the jackpot, I could stand there and say "I was right to trade that winning lotto ticket for a burrito" and not feel bad about it. It'd be a bit of a shock and I'd have to go back and make sure that I didn't err, but ultimately I wouldn't have any regrets.
If, say, it was given to me as a "lucky ticket" with a wink and a nod by some mob boss whose life I'd recently saved... and I traded it for a freaking burrito because "it's probably 1 in 100 million, and 1 in 100 million isn't worth taking seriously"... I'd be kicking myself real hard for not taking a moment to question the "probably" when I learned that I traded a winning ticket for a burrito.
And all those times the ticket from the mob boss didn't win (or I didn't realize it won because I traded it for a burrito) would still be tremendous mistakes. Just invisible mistakes if I don't stop to think and it doesn't happen to whack me in the head. The idea of making mistakes, not realizing, and then using that lack of realization as further evidence that I'm not overconfident is a trap I don't want to fall into.
My brief attempt at "general advice" is to make sure you actually think it through and would be not just willing to but comfortable eating the loss if you're wrong. If you're not, there's your little hint that maybe you're ignoring something important.
When I point people to these considerations ("you say you're sure, so you'd be comfortable eating that loss if it turns out not to be the case, the vast majority of the times when they stop deflecting and give a firm "yes" or "no", the answer is "no" - and they rethink things. There are all sorts of caveats here, but the main point stands - when its important, most people conclude they're sure without actually checking to their own standards.
That's just not making bad decisions relative to your own best models/metamodels - you can still make bad decisions by more objective standards. This can't save you from that but what it can do is make sure your errors stand out and don't get dismissed prematurely. In the process of coming to say "yes, and I can eat the loss if I'm wrong" you end up figuring out what kinds of things you don't expect to see and committing to the fact that your model predicts they shouldn't happen. This makes it a lot easier to both notice the fact that your model is wrong and harder to let yourself get away with pretending it isn't.
I don't know about that. That clearly depends on the situation -- and while you probably have something in mind where this is true, I am not sure this is true in the general case. I am also not sure of how would you recognize this type of situation without going circular or starting to mumble about Scotsmen.
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