https://www.smbc-comics.com/comic/ev-2

Gotta optimize for life not just numbers

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[–] 149 points 2 months ago (6 children)

You can still reason about expected value in this situation, just $ is not really what you want to optimize for.

When you view it as “100% chance of being able to afford anything” vs “50% chance of being able to afford anything” it becomes more clear.

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  • [–] 3 points 2 months ago* (last edited 2 months ago) (1 child)

    You see the expected value fallacy thing pop up in real life when the lottery hits big digits. “Did you hear? The jackpot is over $1 billion! Let’s go buy tickets.”

    Let’s be real, after $100 million, or honestly even $10 million, increasing the jackpot doesn’t change how much effect that money has on your life very much. At that point, likelihood is a lot more important.

    But every time the jackpot peaks, it’s like all of these intelligent, thoughtful people around me lose their ability for rational thought. Why would you buy a lottery ticket now, but not when the jackpot was $500 million a month ago?

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