Actually, no, I would expect that investors and/or traders would be more rational than the average for that very reason. The brain can be trained, or I wouldn’t be here; that doesn’t say much about it’s default configuration, though.
As far as biases—how about the existence of religion? The fact that people still deny evolution? The fact that people buy lottery tickets?
And as far as optimality goes—it’s an open question, I don’t know. I do, however, believe that the brain is not optimal, because it’s a very complex system that hasn’t had much time to be refined.
investors and/or traders would be more rational than the average
That’s not good enough—you can “use mathematics” and that gives you THE optimal result, the very best possible—right? As such, anything not the best possible is inferior, even if it’s better than the average. So by being purely rational you still should be able to extract money out of the market taking it from investors who are merely better than the not-too-impressive average.
As to optimality, unless you define it *somehow* the phrase “brain is not optimal” has no meaning.
I am not perfectly rational. I do not have access to all the information I have. That is why am I here: to be Less Wrong.
Now, I can attempt to use Bayes’ Theorem on my own lack-of-knowledge, and predict probabilities of probabilities—calibrate myself, and learn to notice when I’m missing information—but that adds more uncertainty; my performance drifts back towards average.
As to optimality, unless you define it somehow the phrase “brain is not optimal” has no meaning.
Not at all. I can define a series of metrics—energy consumption and “win” ratio being the most obvious—and define an n-dimensional function on those metrics, and then prove that given bounds in all directions that a maximum exists so long as my function follows certain criteria (mostly continuity.)
I can note that given the space of possible functions and metrics, the chances of my brain being optimal by any of them is extremely low. I can’t really say much about brain-optimality mostly because I don’t understand enough biology to understand how much energy draw is too much, and the like; it’s trivial to show that our brain is not an optimal mind under unbounded resources.
Which, in turn, is really what we care about here—energy is abundant, healthcare is much better than in the ancestral environment, so if it turns out our health takes a hit because of optimizing for intelligence somehow we can afford it.
I can define a series of metrics—energy consumption and “win” ratio being the most obvious—and define an n-dimensional function on those metrics, and then prove that given bounds in all directions that a maximum exists
I don’t think you can guarantee ONE maximum. But in any case, the vastness of the space of all n-dimensional functions makes the argument unpersuasive. Let’s get a bit closer to the common, garden-variety reality and ask a simpler question. In which directions do you think human brain should change/evolve/mutate to become more optimal? And in these directions, is the further the better or there is a point beyond which one should not go?
so if it turns out our health takes a hit because of optimizing for intelligence somehow we can afford it
Um, I have strong doubts about that. Your body affects your mind greatly (not to mention your quality of life).
Actually, no, I would expect that investors and/or traders would be more rational than the average for that very reason. The brain can be trained, or I wouldn’t be here; that doesn’t say much about it’s default configuration, though.
As far as biases—how about the existence of religion? The fact that people still deny evolution? The fact that people buy lottery tickets?
And as far as optimality goes—it’s an open question, I don’t know. I do, however, believe that the brain is not optimal, because it’s a very complex system that hasn’t had much time to be refined.
That’s not good enough—you can “use mathematics” and that gives you THE optimal result, the very best possible—right? As such, anything not the best possible is inferior, even if it’s better than the average. So by being purely rational you still should be able to extract money out of the market taking it from investors who are merely better than the not-too-impressive average.
As to optimality, unless you define it *somehow* the phrase “brain is not optimal” has no meaning.
That is true.
I am not perfectly rational. I do not have access to all the information I have. That is why am I here: to be Less Wrong.
Now, I can attempt to use Bayes’ Theorem on my own lack-of-knowledge, and predict probabilities of probabilities—calibrate myself, and learn to notice when I’m missing information—but that adds more uncertainty; my performance drifts back towards average.
Not at all. I can define a series of metrics—energy consumption and “win” ratio being the most obvious—and define an n-dimensional function on those metrics, and then prove that given bounds in all directions that a maximum exists so long as my function follows certain criteria (mostly continuity.)
I can note that given the space of possible functions and metrics, the chances of my brain being optimal by any of them is extremely low. I can’t really say much about brain-optimality mostly because I don’t understand enough biology to understand how much energy draw is too much, and the like; it’s trivial to show that our brain is not an optimal mind under unbounded resources.
Which, in turn, is really what we care about here—energy is abundant, healthcare is much better than in the ancestral environment, so if it turns out our health takes a hit because of optimizing for intelligence somehow we can afford it.
I don’t think you can guarantee ONE maximum. But in any case, the vastness of the space of all n-dimensional functions makes the argument unpersuasive. Let’s get a bit closer to the common, garden-variety reality and ask a simpler question. In which directions do you think human brain should change/evolve/mutate to become more optimal? And in these directions, is the further the better or there is a point beyond which one should not go?
Um, I have strong doubts about that. Your body affects your mind greatly (not to mention your quality of life).