5 ms·

All of your counterexamples seem to me to be speciously unlikely, and so under-representative of reality that I honestly find myself wondering whether you're tr

by rosser 12y ago

All of your counterexamples seem to me to be speciously unlikely, and so under-representative of reality that I honestly find myself wondering whether you're trolling. Let me ask the question even more pointedly: to whom would the unexpected receipt of $1000 be more beneficial, a single, paycheck-to-paycheck mother who drives a '90s Accord, or the scion of a squillionaire tycoon, trying to decide between different colors of leather for his new Ferrari? Do you still maintain those things can't be compared?

RickHull 12y ago
> Do you still maintain those things can't be compared? Only intuition tells us they can be compared. Utility theory given subjective preference gives us no tools to make the comparison nor any way of verifying it. We have only the pretense of knowledge. Compare to e.g. diminishing marginal utility for a single person, which has a clear theoretical and verifiable basis. Here is why intuition is misleading: we can easily intuit the fact of our own diminishing marginal utility. Then we can say: if I was poorer, diminishing marginal utility makes the marginal dollar worth more to me. However, this does not hold across a different set of subjective preferences. Our intuition is strongly biased against the full recognition of subjective preference because it operates by injecting our own subjective preference onto others. When we imagine how some other person lives, we really imagine ourselves in that position. Unfortunately, we can only know others' preferences via revealed preference. Intuition is a poor guide. Furthermore, for any specific (and particularly extreme) example, our intuition might be strong enough to dismiss theoretical concerns. However, this does not generalize. Finally, if the mother prefers to spend the $1000 on crack, then any choice of leather is more beneficial.

by rosser 12y ago

RickHull 12y ago

> Do you still maintain those things can't be compared? Only intuition tells us they can be compared. Utility theory given subjective preference gives us no tools to make the comparison nor any way of verifying it. We have only the pretense of knowledge. Compare to e.g. diminishing marginal utility for a single person, which has a clear theoretical and verifiable basis. Here is why intuition is misleading: we can easily intuit the fact of our own diminishing marginal utility. Then we can say: if I was poorer, diminishing marginal utility makes the marginal dollar worth more to me. However, this does not hold across a different set of subjective preferences. Our intuition is strongly biased against the full recognition of subjective preference because it operates by injecting our own subjective preference onto others. When we imagine how some other person lives, we really imagine ourselves in that position. Unfortunately, we can only know others' preferences via revealed preference. Intuition is a poor guide. Furthermore, for any specific (and particularly extreme) example, our intuition might be strong enough to dismiss theoretical concerns. However, this does not generalize. Finally, if the mother prefers to spend the $1000 on crack, then any choice of leather is more beneficial.