Revealed Preference
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2009[edit]
One detector at LHC only requires the threat of data. Measuring hype by circulating wagers, it's called 'revealed preference'.
The highest odds offered for any positive LHC result on Higgs, Supersymmetry, etc.. is N:1. Solve for N.
What are the best odds and terms currently available on $10000 betting against supersymmetry at LHC?
Revealed preference is a theory that we must trust google with our secrets more than our spouses, government or children.
2010[edit]
I guessed wrong when I first heard Coase's theorem phrased as an economics puzzle. No shame in that: it's as deep as it is elegant.
To me, Coase's result is simultaneously radical in opposite political directions by decoupling efficiency & distribution via securitization.
Via revealed preference, Coase seems to me a modern Solomon asking "Do you really love efficiency, or do you plead before us to seek rent?"
2016[edit]
I'm watching my mind changing. It can't make reliable sense of individual events as much. Too many cryptic players. Some skilled, some not.
@gabrielapetrie That's great! I just don't know how you know w confidence if the obvious explanation is the correct one. I can't do that now
It truly is your mind changing, not the world, @EricRWeinstein. Because covert intrigue is nothing new...
Yes to "it's nothing new." No to "same old same old. Nothing's changed." If anything, it's an older way rebooting itself now.
If anything, you're now making more reliable estimates about the meta-probability of proper attribution
85% agree for most folks. The illusion of "I get this" is slowly evaporating.
what you're noticing is (1) the proliferation of less skilled players and (2) their greater visibility via modern media
1) is total agreement. Very hard to do revealed preference with the incompetent actors now proliferating.
2021[edit]
There is a very simple way that Pharmaceutical companies can quash the fears of misinformation using the economic theory of Revealed Preference: By forgoing the protection of the PREP act from liability if vaccines are later found unsafe:
https://t.co/5IeGArjgou via @pharmexec
Here's how it works. We are all told that these vaccines are safe and effective. That will not prevent frivolous lawsuits, so Pharmaceutical executives will *need* to be immunized from that. The expert claim is that the vaccines are safe and will not have long term side effects.
This is good news. Even great news. This allows Pharma executives to SILENCE ONCE AND FOR ALL all concerns about vaccine safety and disinformation that threaten public health. By forgoing protection from liability of unintended consequences, the anti-vaxxers lose instantly. WIN!
One does not need liability protection for selling pure distilled water or healthy iceberg lettuce. Same with safe vaccines. All that's needed is protection from FRIVOLOUS lawsuits, not from actual injury or death due vaccine as the vaccines are safe.
This gets us herd immunity.
Let's get big Pharma the immunity they need from frivolous lawsuit. Make it ABSOLUTE. But let us ask them in turn to lead the way by showing how confident they are. If vaccine hesitancy is madness, the safety of the vaccines are the only protection they need. Let's get this done.
As the recipient of the Johnson & Johnson Covid Vaccine and w/ family vaccinated with Pfizer's Vaccine, I call on executives of these two companies to show the same faith in their product that I have shown. This is the slam dunk that ends the issue. All it takes is confidence. đ
Please share the lead tweet in this thread if you are concerned that throttling by Twitter will keep this proposal from being considered and helping to get us to Herd Immunity quickly. Let's change the discussion and go back to old style leadership in crisis.
Thank you.
ANNOUNCEMENT: I head next week to @UChicago for 5 days (Nov. 8-12) at the request of its storied Department of Economics to present our theory that all of economics is based on the wrong version of the differential calculus.
Importantly, this error afflicts Inflation & the CPI.
Hi Eric, where can I find your calculations, data, and conclusions on what the real inflation and CPI numbers are?
Weird question. You seem to have me confused for the BLS. I don't take in Data. I don't have a staff or a budget. You're assuming that I have the 'Real Inflation & CPI numbers'. I don't.
This is about not even having a correct *theory* to calculate. What we corrected was theory.
So if you have the correct theory then why wouldn't you be able to calculate the correct results from the existing input data available?
I didnât say what you said. I said there was a wrong theory for CPI. We corrected that theory.
The issue of how to implement a theory in practice leases to different data being collected and different aggregations. For a different theory, you would collect different data.
As an example. The Boskin commission gave a single illustrative example in their report using two goods, chicken and beef. They gave prices but not ordinal utility. Here is the COL answer assuming Cobb-Douglas and Linear interpolation of all quantities. They could not compute it.
The reason they had no theory to cover it was because the C-D exponent changed. And there is a claim that no extension of the Konus COL exists for dynamic tastes.
Hope that helps with your confusion. Be well.
*leads not leases in the above.
Yea I understand that and find your points interesting. So I would like to understand how we would go about invalidating the traditional theories by collecting and analyzing the correct data. I don't think those tweets answer that. I get your hypothesis.
Well I think the BLS should begin by questioning their own premises. They say they work in a COL framework. They do not. They do not share how they construct the representative consumer. How they estimate substitution if they donât have preference data. Itâs fake and a mess.
If they are going to do COLas they should estimate preferences. If they arenât they should do mechanical index theory.
But I would use a bunch of that money to develop a research program on preference collection/imputation for substitution bias if I was running a COL shop.
Ok how many researchers would you need? Is the average salary $300k? What are the non-labour costs needed? Could this be done in 1 year?
Could we get this done with let's say $10m? Is $609m necessary for a MVP?
I am not sure. But the first question I have is do we believe ordinal preference maps are constructable from revealed preference.
Well if we were to get you started with all the resources necessary, wouldnât the assumption be yes to apply your theory?
I would take a look at Paul Samuelsonâs Nobel lecture. He goes into depth on revealed preference and preference field non-integrability. I think we have lost track of the fact that integrability of tastes was never actually settled except by fiat. Will talk on this.
Great news, given that *every* tick of your BLS CPI forces billions of dollars to change hands.
"The concept of the cost-of-living index guides the CPI measurement objective and is the standard by which any bias in the CPI is defined."
I found this on @BLS_gov site. Is it true?
I assure you we are not dangerous! If you want to read about how the BLS calculates the consumer price index you can check out the CPI handbook of methods (https://bls.gov/opub/hom/cpi/).
I cannot find any place where the preference maps needed to construct a Laspeyres Konus COL index are gleaned through revealed preference. I will go so far as to say that this is bait & switch. There is a CLAIM of a COL framework, but no one is constructing anything of the kind.
Q1: Where exactly do I find the ordinal indifference maps constructed by BLS for a 'Representative Consumer' used to find substitution bias in fixed basket Mechanical approximations to a welfare Cost-Of-Living framework based on a Konus economic index of intertemporal welfare?
Q2: What happens to our BLS COL framework when ordinal tastes change? How is the effect of substitution due to price change disaggregated by BLS from changes in ordinal preferences? This is important because marketing, education, etc change tastes & there is no theory for this.
Let me give you the non-answers so you can correct:
A1: "Well, you are looking at it too literally...we have studied superlative index numbers which give a second order approximation to flexible functional form...blah blah blah."
A2: "That's really an obscure academic issue."
What I'm looking for is for BLS to stop pretending it's discerning "THE rate of inflation" to admit that it's making *policy* choices while appearing to be technical. It's determining our taxes and our entitlements by indexing, with our future in its hands as mere 'technicians'.
2023[edit]
Actually what you did was needlessly muddy the waters in a revealed preference situation funded by others.
Think about it. Youâll get it eventually.