Risk vs Uncertainty: What People Confuse
Risk has known probabilities; uncertainty doesn't. With risk you can calculate odds, with uncertainty you can't even assign probabilities to outcomes.
March 2026
June 2025
Origins of Decision Theory: Key Developments
Decision theory origins: Bernoulli introduced expected utility in 1738. Von Neumann and Morgenstern developed game theory and axioms of...
Using Decision Theory in Everyday Choices
Apply decision theory: list all options, define outcomes for each, assign probabilities to outcomes, calculate expected values, then choose...
December 2024
The Representativeness Heuristic: Judging by Appearances
Linda is 31, outspoken, a philosophy major, passionate about social justice. Is she more likely to be a bank teller, or a bank teller active in the...
November 2024
Gambler's Fallacy: Misconceptions About Randomness
On August 18, 1913, a Monte Carlo roulette wheel hit black 26 consecutive times. Gamblers lost millions betting on red, certain it was 'due.' The...
November 2022
Thinking About Risk: A Practical Framework Explained
A practical framework for thinking about risk: expected value vs utility, availability heuristic, tail risks, diversification, and the Kelly...
August 2022
Monte Carlo Method: How Randomness Solves Complex Problems
The Monte Carlo method uses random sampling to solve problems too complex for direct calculation.