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Rational Decision-Making under Uncertainty: Observed Betting Patterns on a Biase


saltybit
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"After the experiment, we discussed Kelly and optimal betting strategies with our subjects.

We were left with the feeling that they would play the game more effectively if given another

chance. We wonder whether any long lasting impact could be had on investor behavior through

similar discussions of sensible approaches to stock market investing."

 

Given that people, in general, hear what they want to hear and that confidence is typically inversely correlated with competence especially when emotions (money) are involved, I wonder if the authors are not stretching their conclusions.

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"After the experiment, we discussed Kelly and optimal betting strategies with our subjects.

We were left with the feeling that they would play the game more effectively if given another

chance. We wonder whether any long lasting impact could be had on investor behavior through

similar discussions of sensible approaches to stock market investing."

 

Given that people, in general, hear what they want to hear and that confidence is typically inversely correlated with competence especially when emotions (money) are involved, I wonder if the authors are not stretching their conclusions.

 

You are probably right. You could suggest to the authors to rerun the experiment with the same subjects couple years later and see if the subjects internalized Kelly that they were told about.

 

And the authors would get another paper to publish.

 

And everyone would be happy.  8)

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