100% agree with the principle that buying peace of mind can be a good deal whether the peace of mind is quantitatively justified or not, and the broader principle that we shouldn’t be disdainful of emotions. But while emotions aren’t entirely rational, they’re not entirely irrational either. I expect that learning and applying the method in this post will help the user feel peace of mind at a level of insurance that’s somewhat closer to optimal than they would have otherwise.
It’s also probably useful to learn the quantiatively optimal strategy so you can be consciously aware of what premium you’re paying for peace of mind, and make thoughtful decisions about how much it’s worth to you. I said that buying peace of mind can be a good deal, but I’ll bet there are people who—if they could see exactly how big the risk-aversion premium they’re paying is—would decide that they’d rather deal with more anxiety and pocket the cash.
100% agree with the principle that buying peace of mind can be a good deal whether the peace of mind is quantitatively justified or not, and the broader principle that we shouldn’t be disdainful of emotions. But while emotions aren’t entirely rational, they’re not entirely irrational either. I expect that learning and applying the method in this post will help the user feel peace of mind at a level of insurance that’s somewhat closer to optimal than they would have otherwise.
It’s also probably useful to learn the quantiatively optimal strategy so you can be consciously aware of what premium you’re paying for peace of mind, and make thoughtful decisions about how much it’s worth to you. I said that buying peace of mind can be a good deal, but I’ll bet there are people who—if they could see exactly how big the risk-aversion premium they’re paying is—would decide that they’d rather deal with more anxiety and pocket the cash.