I mentioned this in my last post and could not resist it. It is based on a 2009 paper by Herzog & Hertwig, “The Wisdom of Many in One Mind Improving Individual Judgments With Dialectical Bootstrapping.” How can a set of individually mediocre estimates become superior when averaged? The secret is a statistical fact that, although well known in measurement theory, has implications that are often not intuitively evident . A subjective quantitative estimate can be expressed as an additive function of three components: the truth (the true value of the estimated quantity), random error (random fluctuations in the judge’s performance), and systematic error (i.e., the judge’s systematic tendency to over- or underestimate the true value). Averaging estimates increases accuracy in two ways: It cancels out random error, and it can reduce systematic error. This reminds me of Scott Page’s diversity prediction theorem which simply states that the crowd’s error = avg error- diversity. I expect to look at systematic error and diversity in future posts, but for now how can we conduct a dialogue with ourselves and improve our predictions?
This is a mild revolution for me. I was always irritated when someone suggested that someone should pull himself up by his bootstraps. This seemed quite impossible to me. But apparently even my computer is bootstrapping when it is booting. According to Wikipedia, bootstrapping usually refers to the starting of a self-sustaining process that is supposed to proceed without external input. In computer technology the term (usually shortened to booting) usually refers to the process of loading the basic software into the memory of a computer after power-on or general reset, especially the operating system which will then take care of loading other software as needed. ‘‘Bootstrapping’’ alludes to Baron Munchhausen, who claimed to have escaped from a swamp by pulling himself up by, depending on who tells the story, his own hair or bootstraps.
The checklist is a heuristic. Gigerenzer explains that there needs to be something between mere intuition and complex calculations, and those might often be called rules of thumb. Although a checklist can be many things, it also fits between mere intuition and a bunch of analytic reasoning. The best checklists are like Gigerenzer’s fast and frugal tree where you take the best of a yes or no question starting with the most important question and work your way down the tree to the decision. Gigerenzer talks about “ecological rationality”–the match between the structure of a heuristic and the structure of an environment.
I have mentioned Michael Mauboussin’s book The Success Equation before, but this will be the closest I come to a review. The title makes it sound like a self help book, but it is much more substantial. However, his notes and bibliography somehow miss both Ken Hammond and Robin Hogarth which frankly seems unlikely. Hogarth’s books Educating Intuition (post Learning, Feedback and Intuition) and Dance with Chance (post Dancing with Chance) have much in common.
Mauboussin most unique contribution from my view is to bring Bill James and his successors from baseball to the world of skill and luck and investment. And Mauboussin is amazingly honest about the luck involved in investment which is his world. He pretty much says that you cannot be an expert in his field but only experienced. Using sports, especially baseball, makes the book’s ideas much more understandable. That brings us to the idea for this post. Mauboussin calls it reversion to the mean and Kahneman calls it regression to the mean. Either way, baseball makes it more understandable.
Standing in the shower preparing to dry off, I consider myself as at my most lucid condition. But as I dry myself with a big fluffy towel, I tend to move on to another place on the towel when my hands feel any moisture. Thus, although I believe that the dryness or the lack thereof of the side of the towel that my hands can feel is unrelated to the side that is drying off my body, I am usually thinking about something else so I still move the towel. I won’t even try to figure out the function for this, but it is clearly a fallible indicator. Hogarth reminded me of this when he noted our poorer performance when dealing with nonlinear relationships, “Human achievement is lower when there are nonlinearities in the ecology.” (What has Brunswik’s Lens Model Taught?). This reminds me of derivative financial instruments. My intuition cannot handle a straddled put (I think I made that up.) I can learn and feed it in, but give me 15 seconds to figure it out and my performance will be worse than chance. This is kind of a big deal if John von Neumann’s analogy is correct: that studying nonlinear relationships is similar to studying non elephants.
This post is based on the paper, “Fuzzy Trace Theory and Medical Decisions by Minors: Differences in Reasoning between Adolescents and Adults,” by Evan Wilhelms and Valerie Reyna that appeared in the June 2013, Journal of Medical Philosophy. This is an application of Fuzzy Trace Theory to the medical decision setting. The concept is more generally addressed in the first of three posts: FTT Meaning, Memory, and Development.
The mature minor exception allows adolescents under the age of 18 to make medical decisions and consent to procedures with equivalent authority of an adult. Although this was originally conceived to be applied in emergency situations in which parents are not available, it now according to Wilhelms and Reyna represents a blanket exception for those over the age of 14, so long as the benefits outweigh the risks and the adolescent is not otherwise deemed intellectually incapable. This expansion of rights has been used for easier access to abortion and contraceptives without parental consent, as well as the access to treatment for sexually transmitted infections, addictions, mental health problems and prenatal care. On occasion, this expanded legal standing of minors has been used to justify treatment refusal.