Rooting Hard for Overpriced M&Ms

If hypothetically you went to the machine and your wallet was unexpectedly empty, and you noticed the corner of a bill poking out from under the machine, would you rather it be a $1 bill (and you get to buy M&Ms) or it be a $5 bill (and you don't get M&Ms)?

On the contrary - if the bill had been $5 instead of $1, then your bank account would have had $4 less in it, and you couldn't have generated the gains from trade.

Paradox cleverly resolved!

(Actually, I suspect the real answer is that you have a "warm" preference for M&Ms over $1 and a "cold" preference for $5 over $1. System 1 vs. System 2.)

Okay, I've got it. You're a selflessly devoted altruist, and you know that money in your hands doesn't matter any more than money elsewhere - but with a $1 bill, you could generate gains from trade and thereby make the whole world a slightly better place!

You wanted M&Ms. If you had not had a $1 bill you would not have gotten them.

I've done the same thing!

Perhaps you were assuming that your net wealth was a certain fixed amount, and that if the bill had been a $5 instead of a $1, it would have meant that there was $4 less at home or in the bank.

In that case, you're rooting only for having the right change on you, rather than having less money overall.

Since most people get things they want when they spend money, the information you got from looking in your wallet is about configuration, not amount. You were happy because you had correct change, not because you had a $1 bill instead of a $5 bill.

The M&Ms are worth $5 to you at that instant, but you would feel bad spending it.

Your emotions are more wired to produce actions that benefit you, not necessarily to reflect absolute state of utility in the form of happiness. You would not desire to trade $5 to receive $1, your wealth is not affected in any way by what you discover and your instrumental goal was in finding a $1 bill. Nothing is amiss.

Don't your vending machines over there give change? (You can't generally put notes(/bills) in ours over here, but they do generally give change for your coins.)

Did you have few enough bills in your wallet that you could immediately and accurately apprehend how many there were? If not, then there were enough that you didn't know how many there were, and that $1 was one that might as well have not been there according to your initial coarse perception.

Hah. Your software for assessing "the proper prices of things" is separate from your preferences. In a nearby hypothetical world where $5 were the normal price for M&Ms, I think you would've bought them at that price. Because in our world, when the universe took $4 away from you as a fait accompli but allowed you to enjoy the M&Ms for $1 in return, you liked it! In effect, you were deprived of the chance to notice the "unfairly high" price of $5, so the blame/propriety circuit was stopped from interfering with your actual preference =) If the sole bill in your wallet had been a $100 but then "luckily" morphed into $1, I guess you wouldn't have been as happy!

The circumstances you describe are pretty weird. When I search my wallet for a single, I don't think, "There are twelve bills in my wallet. I hope one of them is a single." I think, "That a single? Nope. That one? Nope. That one? There we go!" The question isn't, "What's the value of each bill in my possession," but, "Do I have a single in my possession?" Discovering that I have a single simply does not entail discovering that I don't have a bill of greater value.

But I think you may be missing the meaning of that happiness you experienced. Your immediate goal was buying M&M's. You thought you couldn't accomplish this. Then, you found out you could, and this made you happy. That happiness was not comparative; you simply experienced a kick of satisfaction because something you hoped for turned out to be true. Your happiness is not an indicator of your general preferences, it is a result of your hope being fulfilled. Concluding that experience indicates you preferred having $1 to having $5 may be inappropriate.