Thursday, October 20, 2011

Randomness, Probability, and Frequencies

 
Human brain developed to identify patterns promptly, and rely upon those judgments. For example, if our stone-age ancestor’s saw a wolf in the forest, they had to quickly identity possible threat and act accordingly. In case of miscalculation, one died quickly. So, from the evolutionary perspective, the only surviving people today are descendants of the people who were good at making right mental short cuts. However, using heuristics is what usually messes people judgments up. Masculine, bold man with a "Manchester United" t-shirt is not always a football hooligan. People tend to use representative heuristics, when making fast judgments about other individuals.  
Intuition plays a major role in people judgments. But can we rely on our intuition when judging randomness of the events? One the best known randomness miscalculation case is Italian number 53 "nightmare". In Italy's national lottery  number 53 did not popped  for  nearly two years. Some of the people had bet all their life savings hoping that it will appear on the next draw. The mysterious number caused several deaths and bankruptcies.  This example shows us that people have confused perceptions of randomness. I presume that it is a player's dream to have the brain that works like a very advanced calculator then he could always guess the next coming number on the roulette wheel. Unfortunately, human brain is not a computer and we are often misleaded by our illusion of randomness.  

1 comment:

  1. I like the example about the wolf scare that contributed to natural pre-selection of the strongest and smartest homo-sapience “who were good at making mental short cuts”. But what if the strongest, quickest and cleverest man in the tribe was also the most altruistic and went above and beyond saving the weak once in the tribe instead of saving himself and became a victim without leaving descendants. What about individual ability of risk assessment? Can sane person rationally asses the risk before decision making? (ex: betting all his life savings on the lottery ticket!) While making a decision is he relying on intuition, adrenalin rush, pride or passion?

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