tag:blogger.com,1999:blog-7905515.post5939929493147868959..comments2024-03-14T11:09:32.759-05:00Comments on Falkenblog: Risk Premium Worthless, ConvolutedEric Falkensteinhttp://www.blogger.com/profile/07243687157322033496noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-7905515.post-30211026061541193332011-08-24T11:25:36.141-05:002011-08-24T11:25:36.141-05:00Folks, it is a symptom of our modern economy. Sin...Folks, it is a symptom of our modern economy. Since there is not much real work left to do (and what is left to do is quite unpleasant), people sit around thinking up dumb ideas, shuffling papers around, and basically participating in giant circle-jerk sessions. <br /><br />Welfare disguised as work = the future for most "workers".Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-69624551757015108552011-08-23T19:44:55.157-05:002011-08-23T19:44:55.157-05:00On the other hand, econo-physicists perpetrate wor...On the other hand, econo-physicists perpetrate worse intellectual misdemeanors. E.g., percolation modelling; treating price as a primitive rather than the result of an underlying process. (<-- which the "utility" approach gets right)human mathematicshttp://math.hiremebecauseimsmart.comnoreply@blogger.comtag:blogger.com,1999:blog-7905515.post-68877157116742472102011-08-23T19:34:20.909-05:002011-08-23T19:34:20.909-05:00What you're saying about utility functions is ...What you're saying about utility functions is so true! It's really frustrating the seriousness / literalness with which they're read.<br /><br />Economists have, and have had, a serious problem with probability. It's so tempting to use the exact same machinery on a prob. distribution. But, all the philosophical problems with probabilities of one-off events are inherited, grotesquely, by real-world applications / measurements of probabilities.<br /><br />Not that I want to throw the baby out with the bathwater -- even if I can't say that I have literally a 1-in-3 chance of getting this job, the way probabilities add (say I apply to seven 1-in-3 jobs) seems reasonable. And likewise with utility: unmeasurability is a problem; yet certain axioms like d/dx>0, d²/dx²<0 and &partial;/&partial;x × &partial;/&partial;y > 0 are in the right spirit.<br /><br /><br /><br />I don't totally understand G&H's English (I didn't click thru) but it does sound like assuming everything always works out perfectly unless proven otherwise.human mathematicshttp://math.hiremebecauseimsmart.comnoreply@blogger.com