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Monday, June 27, 2011

Paul Samuelson and Risk-Aversion

Interesting stat-type decision-making problem from Psychology Today dealing with "irrational behavior" being "seductive":

http://www.psychologytoday.com/blog/the-decision-tree/201106/can-psychology-solve-classic-paradox

At first glance it doesn't seem terribly profound to me, though it's apparently more nuanced than it looks on the surface. (Be sure and read the comments as well; unfortunately the Samuelson 'proof' alluded to isn't readily available.)

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