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Typically, as long as the expense is deemed prudent by regulators, utilities are permitted to 'rate base' the expense and earn a return on investment. If PG&E think it's politically possible to increase expenses by $20-30B because there's a good narrative to offset complaints of rising utility prices, it's the selfish thing to do. The times that require strict scrutiny for investor-owned utilities is when they jump on the bandwagon of a politically popular spending proposal (wise infrastructure investments comes from experts getting the politicians on board, not politicians getting the experts on board).
Liberals see the free market as a kind of optimizer run amuck, a dangerous superintelligence with simple non-human values that must be checked and constrained by the government - the friendly SI. Conservatives just reverse the narrative roles.
I like this analogy. So basically, how do you want to balance the power between your two overlords, one much much smarter than you but with non-human values, and the other much dumber than you but with human (mostly) values.
Thanks. I'd love to share this material with people but the format makes it hard as many people seem to have an aversion to a collection of blog posts. I look forward to buying the book so I can loan it to people.
Competed the survey. Thanks for doing this, the results are always interesting.
Does anyone know what happened to the version that was supposed to be reviewed/edited down by a professional so it could be publishable length? There's so much good stuff there I'd love to be able to send to friend and family but 500k worth of blog posts is much harder to send someone than a nicely published 200k version.
Yes but as soon as you thought of it it becomes a known known :)
The "known knowns" quote got made fun of a lot, but I think it's really good out of context:
"There are known knowns; there are things we know that we know. There are known unknowns; that is to say, there are things that we now know we don't know. But there are also unknown unknowns – there are things we do not know we don't know."
Also, every time I think of that I try to picture the elusive category of "unknown knowns" but I can't ever think of an example.
I deconverted in large part because of Less Wrong. Looking back at it now, I hadn't had a strong belief since I was 18 (by which I mean, if you asked most believers what the p(god) is they'd say 100% whereas I might have said 90%) but that might just be my mind going back and fixing memories so present me thinks better of past me.
I'd be happy to do an AMA (I went from Mormon to Atheist) but a couple of the main things that convinced me were:
Seeing that other apologists could make up similar arguments to make just about anything look true (for example, other religious apologists, homeopathy, anti-vaccines, etc)
Seeing the evidence for evolution and specifically, how new information supports true things. That showed me that for true things, new information doesn't need to be explained away, but actually supports the hypothesis. For example, with evolution discoveries such as carbon dating, the fossil record, and DNA all support it. Those same discoveries have to be explained away via apologetics for religions.
Bayesian thinking. I have an econ background so kind of did this informally but the emphasis from less wrong that once you see evidence against you need to actively lower your probability a bit really helped me. Before I'd done what EY pointed out where you take all of your evidence for and stacked that against this one evidence against and then when the next evidence against comes along you take all your evidence for and stack it against that one evidence, etc.
The value that I want to believe what is true. I had this before but wasn't as proactive about it.
Before I felt like my belief system was logical and fit the evidence and if someone didn't believe it was because they hadn't looked at the evidence and fairly considered it. Seeing people look at the evidence and then cogently explain why they still didn't believe gave me a "I notice I'm confused" moment.\
etc.
My take away from this is that you need to "shut up and multiply" every single time. Looking at the math skills study, the thought was that people glance at the raw numbers (instead of looking at the ratios) and stop there if they fit their ideological beliefs. If it conflicts with your beliefs though you spend a little longer and figure out you need to look a the ratio. So if we train ourselves to always "shut up and multiply" hopefully some of this effect will go away. Maybe a follow-up study to see if people who actually do the math still get it wrong?
I'm already booked that day but if it's a weekly thing I wouldn't mind stopping by sometime.
Hmm, the microeconomics of outsourcing child production to countries with cheaper human-manufacturing costs... then we import them once they're university aged? You know you've got a good econ paper going when it could also be part of a dystopia novel plot.
would you seriously, given the choice by Alpha, the Alien superintelligence that always carries out its threats, give up all your work, and horribly torture some innocent person, all day for fifty years in the face of the threat of a 3^^^3 insignificant dust specks barely inconveniencing sentient beings? Or be tortured for fifty years to avoid the dust specks?
Likewise, if you were faced with your Option 1: Save 400 Lives or Option 2: Save 500 Lives with 90% probability, would you seriously take option 2 if your loved ones were included in the 400? I wouldn't. Faced with statistical people I'd take option 2 every time. But make Option 1: Save 3 lives and those three lives are your kids or option 2: Save 500 statistical lives with 90% probability I don't think I'd hesitate to pick my kids.
In some sense, I'm already doing that. For the cost of raising three kids, I could have saved something like 250 statistical lives. So I don't know that our unwillingness to torture a loved one is a good argument against the math of the dust specks.
Can players coordinate strategies? There's an advantage if two or more submitter can identify themselves (in game) and cooperate.
If there is an 'm' reward, you get the same reward whether or not you choose to hunt? I'm confused how this adds incentive to hunt when your goal is to "get more food than other players," not "get food."
Are the sequences still going to be made into a publishable book? If so, how is that process coming along?
Is there a thread somewhere about effective ways to plant the 'rationalist seed' in your children? I'd like to see something other than anecdotes ideally. But just ideas about books to read, shows to watch, or places to visit for different ages of children would be useful to me. For example,
My 2 and 4 year old both love Introductory Calculus For Infants
And a couple of years ago I got the the Star War ABC which lead to a HUGE love of Star Wars. I'm hoping that turns into a love of Science Fiction...
Maybe it's just where my mind was when I read it but I interpreted the quote as meaning something more like:
"It is wrong always, everywhere, and for anyone, to believe anything upon insufficient evidence."
Tim Harford has some relevant comments:
What does that tell us – that prisoners take care of each other? Or that they fear reprisals?
Probably not reprisals: they were promised anonymity. It’s really not clear what this result tells us. We knew already that people often co-operate, contradicting the theoretical prediction. We also know, for instance, that economics students co-operate more rarely than non-economists – perhaps because they’ve been socialised to be selfish people, or perhaps because they just understand the dilemma better.
You think the prisoners just didn’t understand the nature of the dilemma?
That’s possible. The students were much better educated and most students had played laboratory games before. Maybe the prisoners co-operated because they were too confused to betray each other.
That seems speculative.
It is speculative, but consider this: the researchers also looked at a variant game in which one player has to decide whether to stay silent or confess, and then the other player decides how to respond. If you play first in this game you would be well-advised to stay silent, because people typically reward you for that. In this sequential game, it was the students, not the prisoners, who were more likely to co-operate with each other by staying silent. So the students were just as co-operative as prisoners but their choice of when to co-operate with each other made more logical sense.
This is what I was trying to avoid with my asterisk, i.e., just talking about stealing candy does raise the probability they stole the candy. But once they're talking, confessing raises the probability they did it so not confessing should lower it.
On reflection, when my original question was designed to help make situations clearer, using an example that I felt I had to asterisk probably wasn't wise.
How would I update my probabilities if I saw the opposite piece of evidence? What I’m trying to get at here is that “A” and “not A” can’t really be evidences for the same thing. And often it’s more obvious which way “not A” is pointing. A couple of examples:
I saw someone suggesting that maybe a certain Mr. Far Wright was secretly gay because, when the subject was broached, he had publicly expressed his dislike of homosexuality. There was even a wiki page (that I now can’t find) laying out the “law” that the more a person sounds like they hate gays the more likely they are to be gay. At first this sounded appealing*, but then I applied the “not A” test: “if Mr. Far Wright’s sexual orientation is unknown and I heard him publicly declare that he loved homosexual behavior, how would I update the probability that he is gay?” In that case, it seems clear that I’d update it towards him being gay. Therefore, it doesn’t really make sense that when Mr. Wright does that opposite—publicly declaring that he hates homosexual behavior—I also update my probability that he is gay.
Or another recent example I had from talking with someone about Mormonism. Someone said that not having the golden plates available for inspection wasn’t really evidence against Joseph Smith’s story because there were several good reasons why they weren’t available. I was about to concede when I realized that a world where the golden plates were observable would be strong evidence for Joseph Smith’s story so a world where they aren’t has to be at least weak evidence against his story. If A moves the probability quite a bit one way, not A has to at least minimally move the probability the other way.
*Sometimes, if all I can observe, is a denial, it is evidence that the person is guilty. For example, if I walked through the door and the first thing I heard was my toddler denying to my wife that he took the candy, it increases my probability that he did take candy. But too my wife—who already has the evidence that led her to make the accusation—a denial is evidence against him taking the candy (it increases the relative odds that his brother did it instead).
Did I keep all of my reasoning here correct? If not, there might be a better way to express the idea with a Bayesian network.
Some variation of “What is the other person’s actual objective?” Or “Why did they do that?” or “What are they actually asking me?”
I started this habit in chess where it’s always useful to ask ‘why did my opponent make their last move?’ (and then see if there are answers past the obvious one). But I’ve also found it useful in other areas. Several times at work I've gone through iterations of something with someone because I answered exactly what they said instead of what they actually wanted. I now try to stop and ask them what their actual purpose is and it often saves me a bit of work.
A question I have is how to evaluate the morality of the two options:
- A) Make it so that an animal is born, then later cause it considerable suffering
- B) Change the conditions so that the animal never exists
If everyone went vegetarian, the animal population would likely be greatly diminished and it isn't obvious to me that I'd choose option B over option A if I were on the menu. Are there some standard objections to the idea that option A is better than option B?
One quick objection might be that it proves too much. If John Beatmykids told me he wouldn't have kids unless he was permitted to beat them, I wouldn't give him a pass to beat any future children. Another objection might be that there's always a choice C, but here I don't see another option as realistic.
I was going to point that out too as I think it demonstrates an important lesson. They were still wrong.
Almost all of their thought processes were correct, but they still got to the wrong result because they looked at solutions too narrowly. It's quite possible that many of the objections to AI, rejuvenation, cryonics, are correct but if there's another path they're not considering, we could still end up with the same result. Just like a Chess program doesn't think like a human, but can still beat one and an airplane doesn't fly like a bird, but can still fly.
I was writing an article and trying to refer to www.worstargumentintheworld.com but it appears to be down. Is the registration still valid and/or going to be renewed?
An easy way to do it would be to charge the "correct" marginal cost for all kWh and have a separate fixed fee. My water bill is something like $50 fixed and then a small amount for the water I use after it; the electric bill could work the same. Ronald Coase argued that here
Commercial meters have priced kW for a long time and I think the reason residential didn't was more along the lines of they're more homogeneous than the meter costs. But either way, it seems everyone is getting smart meters now and you could match it up to theory exactly if it were politically feasible.
This doesn't apply in all countries. In UK for instance, it is common to have a standing charge (flat fee per day) as well as a usage charge (fee per kWh). Or some utilities charge a high price for the first few kWh, and then a lower price for subsequent kWh, which has a similar effect. See here for some details.
My perspective is US-centric, but from what I'm aware the per kWh price in most countries for most people is well above the marginal costs. Many places do have a daily or monthly charge but that tends to be $10 or less--not even close to high enough to recover all the fixed costs associated with a customer. Looking through some of the Scottish Power rates that you linked to, the daily charge doesn't get much higher than 30p. That helps mitigate the issue a bit, but it's still there. In that case, retail kWh prices--after the standing charge--is still over 10p / kWh. Wholesale rates look like they're 4.5p in the UK (which should be a good proxy for short run marginal costs) so there's still a big gap.
Even where there is a single price (a price per kWh) it is not true that the "correct" market price is just the marginal cost...
As far as I'm aware, economic theory says the "correct" price for electric utilities is lower than where the actual price is. It's probably easier to visualize on a graph like this one. (I'm saying the difference between Pf and Pr, at least in some cases, may be higher than the externality, which is a real-life example of what the op is talking about). If that's not standard economic theory though let me know as it's an area of interest to me.
The market correction mechanism you described works for most industries but electric utilities are typically treated as natural monopolies, the optimal number of suppliers is one. But even if that 's not true (i.e. it's not actually optimal), in many places regulation only allows one supplier so the market forces described couldn't work. The result is that the average /kWh price customers pay is higher than the average marginal costs (optimal society price) and it continues indefinitely because new firms can't come into the market. There isn't large profits made though because they're pricing at the regulated price (at the average total cost) and not at the monopoly price (again, easier to visualize on the graph linked to above).
The real life example here is electric utilities. The way they're regulated they charge a kWh price roughly equal to the average total cost (let’s say about 12 cents). The proper way to price would be at the marginal cost (at around 4 cents). The fact that marginal costs are below average total costs are what makes them a natural monopoly.
The somewhat obvious better solution would be to charge marginal cost for each kWh and then have some other method to collect the massive fixed costs. But for whatever historic reasons, we don't do that and most (all?) utilities price each kWh at about the average total cost. This means that as a society our quantity demanded kWh is way below where economic theory says it should be.
However, there is probably a fairly substantial pollution/CO2 externality to producing electricity. Without some analysis it isn't obvious whether we're producing too much electricity or too little.
I did try once to look at estimates of the size of the externality to see if it made up for the pricing way above marginal cost issue and the preliminary results were that the externality was smaller (meaning, global warming considered, we're still not using enough electricity). However, there were a couple of points I'd need to get into deeper.
1) The pricing above marginal cost issue is greatest for residential rates and smallest for industrial rates. I was looking at residential rates. Using the same cursory analysis on industrial rates would mean that we're over using electricity in industrial sectors.
2) The carbon externality number I used from the EPA seemed to be derived by figuring out how high the price of electricity would need to be to get usage down to the level they wanted. Under correctly priced utility rates (i.e., priced at the marginal costs), their analysis may have had a much higher $ / kWh externality number. But at the same time, I’m a little suspect of that method of calculating the externality as it would indicate if the cost of production halved it wouldn’t be optimal for society to produce more. So I’d need to do some more research to make sure I’m using good pollution/CO2 numbers.
I haven't seen this issue discussed by people like Mankiw when they talk about the Pigou Club and I think it probably should be. If there's interest I could probably write this up a bit more formally and make it a post.
Great article, I have a particular fondness for this line of reasoning as it helped me leave my religious roots behind. I ended up reasoning that despite assurances that revelation was 100% accurate and to rely on it over any and all scientific evidences because they're just "theories", there was a x% chance that the revelation model was wrong. And for any x% larger than something like 0.001%, the multiple independent pieces of scientific, historic, and archaeological evidences would crush it. I then found examples of where revelation was wrong and it became clear that x% was close to what you'd expect from "educated guess." And yes, I did actually work out all the probabilities with Bayes theorem.
Something a Chess Master told me as a child has stuck with me:
How did you get so good?
I've lost more games than you've ever played.
-- Robert Tanner
I'd like to see a study result on that.
In Art History class I learned that a common way for great artists to learn to paint was by copying the work of the masters. I then asked the art teacher why it was a rule that we couldn't copy other famous historical paintings. I can't remember her exact answer but the times I haven't followed her advice and went and copied a great painting, I seem to have learned more. But again, I'd like to see a study result.
I think the subtitle creates some interesting imagery when contrasted with the typical stereotypes of SLC.
I don't mean to be rude but as an FYI:
At times, this evidence can be of critical importance. I can attest that I have personally saved the lives of friends on two occasions thanks to good situational awareness, and have saved myself from serious injury or death many times more.
Lowers my confidence of the post. Almost everyone I know has a story about how they almost died except for a moment of abnormal cunning or pure luck; yet I know few people who have died for reasons that would have been avoidable had they or someone around them been more observant. This suggests to me (since not everyone can be above-average observant or lucky) that in most of those stories, they didn't have as high of a chance of death as they thought they did. It's certainly possible that it's not the case with you, but I'd prefer to either see the specific stories or maybe just use a less extreme example in the post. Or maybe it's just me and no one else is bothered by it.
I wonder if we could get Pundit Tracker to start tracking him? They've mentioned tracking technology pundits in the future.
I'm thinking of it more like Minecraft in real life. I want a castle with a secret staircase because it would be awesome. What I did was spend a day of awesomeness building it myself instead of downloading it and only having five minutes of awesomeness.
Just some feedback: I'm probably about average in math skill here (or maybe below average, the most math I've done is calculus 10 years ago) and with some work I'm able to get through some of this. When I first looked at it I didn't understand anything but reading the wikipedia on VNM utility theorem and the always helpful List of Mathematical Symbols I was able to get through most of Lemma 1. I was able to prove it to my satisfaction using the solver in Excel and can follow most of the proof up until "Thus, the result follows", I don't see how it follows.
Are there any recommendations for slowly improving math skills other than just trying to work through things like this when time permits? Are people willing to host a Google Hangout where they walk through things such as this for those of us who are curious but have difficulty working it out all on our own (I know I probably could work it all out given enough time, but its hard to be motivated enough to make the time. When I first found the site, I didn't know about Bayes theorem or any of the probability theory notation, but I saw its importance and so made sure to spend the time so I can follow it and work it out on my own when needed).
I really like this analysis a lot. For whatever it adds, Google Trends shows it peaking in July 2011, but mostly holding steady. There might be a small decline in the last six months though.
I took it. Thanks for doing this every year, the results are very interesting.
Good post. Programming would be my vote for higher level subject most useful to individuals. Then economics (given my bias that it's my area of focus). And really it's helpful to be proficient in both so you can be a good data analyst.
But I do think you underestimate how important economics is for "how to run a government." Yes, there are a huge number of near Pareto efficient policies that economists recommend that politicians don't implement for political reasons, but one of the biggest differences between the wealth of nations is how well they apply the lessons of economics. For the most part, countries have access to the same level of science and technology; some rich countries (Hong Kong) have far less natural resources than many that are much poorer; but some countries do a much better job of implementing a good economic collection of rules and regulations and that's why they're so much richer. Teaching economics (especially to the 'elites' who will run day run the country) is hugely important for maintaining those policies.
That's a good point too. which brings up the question of why they're not as well accepted. I've kind of figured it was because prediction markets are a new(er) idea and "science advances one funeral at a time." I predict the next wave of economists will all think in terms of prediction markets, p=80%.
Coming from an Econ background, I'm amazed that people don't understand how much information a properly functioning price mechanism conveys and how valuable it is. For me, thinking about the implications of I, Pencil was valuable in helping me understand this and I'd recommend it. People need to understand how the invisible hand and profit motive work (and have some confidence that they do) before they can understand how a prediction market can aggregate all the relevant information into a meaningful probability because prediction markets are a logical extension of those ideas.
I like this as a parable. I've been talking to several people trying to explain cosmology and Occam's razor and why the default position should be "I don't know" instead of "I don't know therefore X" but they just don't seem to get it. Instead of trying to start the conversation with life, the universe, and everything, I should probably start with an example like the George the Giant story above. It should be relatively easy for them to see why George the Giant was a bad belief, even though it satisfied the four criteria (i.e., because it fail's Occam's razor and there's no reason to elevate it above an infinite number of similarly complex answers)
Here's a good example of where I was fooled where I shouldn't have been if I'd been thinking like a proper Bayesian. Prior to reading the article I would have given something like 1/1000 that computers could "solve" a main-line chess opening (to the definition given in the article, which is just that the computer evaluates each line as winning, not that every possible position has been examined). I'd also try to plug in reasonable numbers for newspapers reporting a story as true/false when the story is actually true/false as something like p(newspaper reports true given story is actually true)=95% and p(newspaper reports as true given story is actually false) =20%. Doing the math, there is then almost no chance that the article was true (less than 1%)
And I should have been able to do this in my head. Even if the newspaper reported true stories as true 99% of the time, and a false story as true only 1% of the time, there would have still been about 10 to 1 odds that it wasn't true.
So why did I get fooled? I didn't ever stop to think about it probably, which is embarrassing. Why not? I saw the link from MR and I apparently over-trust Tyler Cowen as a gatekeeper. Had a random person told me about the article I probably would have called BS on it (as I've done before with similar situations) but because someone I trust made the assertion I forgot to apply my brain filters, probably assuming he already did it.
Moral of the story, I need to always, at least briefly, think about my priors and how strong of evidence the source is when I learn new information. Especially if it comes from a source I trust because I'm more prone to believe it.
Company mission statements are notoriously abstract and might make a good starting place. If someone didn't know anything about a company and they went and read the mission statement, they probably wouldn't have a much better idea of what the company actually did.
For example, if (stereotypical) Grandpa asked you what Google was and you replied, "they organize the world’s information and make it universally accessible and useful" you probably wouldn't do much to help him understand what Google is (despite that being one of the best mission statements I can think of). Instead, if you gave a specific example such as: "If you're driving to a new store you can type in the store address and Google will print out a map of how to get there, along with detailed instructions. It's more convenient than a traditional printed map because if you don't know the address you can type in the store name and Google will tell you the address and show you pictures of the view from the street so you'll be able to recognize it when you're driving there." Grandpa would probably have a better idea of what Google does.
So the activity would be to take a company mission statement (abstract) and come up with several examples of specific things that the company did that you could use to describe the company to your grandparents if they'd never heard of it before. The reason to start with the mission statement would be so that participants would be able to mentally contrast abstract statements (that wouldn't help Grandma understand) with specific examples (that would help) and so hopefully learn to avoid making the abstract statements themselves. (For those participants who are Grandparents, they can use companies and products that no longer exist that younger people don't understand and pretend they're explaining it to their grand kids )
A couple minutes before 7:00
I just caught myself mid sentence making an error because of cognitive bias in a situation that might make for a good question. We had a family member that was suppose to come at 6:00 tonight to visit. The person is often (but not always) late so earlier in the evening I said my estimate for them arriving was 6:30. About 6:15 we were sitting waiting for them to come and I looked up at the clock and said, "We'll they're 15 minutes late so far but I'll--" I was going to finish with "stand by estimate of 6:30" but realized that would likely not be optimal any more (or my original estimate of 6:30 wasn't optimal). Given the new information I had, I should update my belief and estimate that they'll arrive later than 6:30. So you could phrase the question:
You have invited guest over for the evening at 6:00pm. They are the type of people who are usually late (sometimes right on time, and sometimes even an hour or more late) and when making your planning you figure that their expected arrival time is 6:30pm. You continue your prep and later look up at the clock and see it is 6:15pm. Should you revise your estimate of what time they will arrive?
P.S. it is now 6:32 and they're still not here.
Not "scripture" study. I suggest scripture study is at least a deadweight loss, perhaps worse. I imagine the purpose of scripture study and so forth in the Mormon context is to enforce conformity.
I had a friend who did family scripture study every day and he (and his 5 or 6 siblings) were among the best readers in school, because they'd sat there and practiced it every single day since they were born. So there are definitively benefits to the scripture reading.
Also, many Mormons do appear to benefit from going on a mission. (To my surprise, many will say it was the "best two years" of their life--do I need to update my model?) Many 20 somethings turn into aimless "kidults" and Mormon Missions do a lot to prevent this by giving a very clear path to move forward with life (High School --> Mission --> College --> Marriage -- > Job).
However, there is a big problem with the conformity. Everyone has a different opportunity cost for scripture study or a mission. For many people, 2 1/2 hours a week of esoteric reading is probably better then the tube; but for those who would otherwise be reading the sequences...
And with missions, they say EVERY young man should serve a mission. It doesn't matter how bad of a fit you are for it (with some health exceptions) or what you would be doing with your time otherwise, you are expected to go. That's a huge conformity cost for kids who are turning down scholarships and delaying important endeavors (Newton and Einstein were both in there 20s when they developed their most important ideas; would they have been able to do so if they went on a Mormon mission at that important time in their life?).
So what a rationalist community could learn from that is not to expect/encourage everyone to derive the same benefits from the same actions.
You haven't read the Sequences?!? seems to have a similar cultural connotation for LessWrongers as You haven't been on a mission?!? does for Mormons. Having other culturally acceptable ways for rational progression seems like a good lesson to learn. For example,
Harry Potter and the Methods of Rationality seems to be a great partial alternative. If someone has read that but not the sequences does the community look down on them?
How many of the sequence ideas could be converted to a RSAnimate type video?
Even having the most important 100,000 words of the sequences in a (printed) book form would be a great help. I feel like I could give a friend a 100k word LessWrong book, but telling someone they should read a million words of blog posts seems odd.