If subjective probabilities are identical to betting probabilities (a common position for Bayesians)
If we start with an expected utility maximizer, what does it do when deciding whether to take a bet on, say, a coin flip? Expected utility is the utility times the probability, so it checks whether P(heads) U(heads) > P(tails) U(tails). So betting can only tell you the probability if you know the utilities. And changing the utility function around is enough to get really interesting behavior, but it doesn’t mean you changed the probabilities.
Half the coins fall Tails, but two thirds of Beauty awakenings are after Tails. Either of these can be interpreted as a probability.
What sort of questions, given what sorts of information, would give you these two probabilities? :D
For the first question: if I observe multiple coin-tosses and count what fraction of them are tails, then what should I expect that fraction to be? (Answer one half). Clearly “I” here is anyone other than Beauty herself, who never observes the coin-toss.
For the second question: if I interview Beauty on multiple days (as the story is repeated) and then ask her courtiers (who did see the toss) whether it was heads or tails, then what fraction of the time will they tell me tails? (Answer two thirds.)
What information is needed for this? None except what is defined in the original problem, though with the stipulation that the story is repeated often enough to get convergence.
Incidentally, these questions and answers aren’t framed as bets, though I could use them to decide whether to make side-bets.
If we start with an expected utility maximizer, what does it do when deciding whether to take a bet on, say, a coin flip? Expected utility is the utility times the probability, so it checks whether P(heads) U(heads) > P(tails) U(tails). So betting can only tell you the probability if you know the utilities. And changing the utility function around is enough to get really interesting behavior, but it doesn’t mean you changed the probabilities.
What sort of questions, given what sorts of information, would give you these two probabilities? :D
For the first question: if I observe multiple coin-tosses and count what fraction of them are tails, then what should I expect that fraction to be? (Answer one half). Clearly “I” here is anyone other than Beauty herself, who never observes the coin-toss.
For the second question: if I interview Beauty on multiple days (as the story is repeated) and then ask her courtiers (who did see the toss) whether it was heads or tails, then what fraction of the time will they tell me tails? (Answer two thirds.)
What information is needed for this? None except what is defined in the original problem, though with the stipulation that the story is repeated often enough to get convergence.
Incidentally, these questions and answers aren’t framed as bets, though I could use them to decide whether to make side-bets.