Appropriate behavior in the face of uncertainty and risk

[ygolo]

Most of the time, when we drive, we will depart and arrive where we are heading without incident.

Yet most of us take the precaution of wearing a seat belt. A small number even strictly obey the speed limit.

What drives your approach to behavior in the face of uncertainty and risk? What is your philosophy towards dealing with uncertain information?

Please provide some examples too (what would it take to put all your investments into 1-stock for instance vs a portfolio and how do you craft a portfolio? What safety features would you include into things that you design even if it drives up cost?)

Are you consistent with your own stated philosophy regarding how you'd respond to risk?

 

[Scaven]

For me, it depends on the importance of the task, the severity of its potential outcome, the energy needed to perform the task, the motivation, the ratio of risk and benefit and so on. It is quite a complicated matter, I guess. For example I want to skydive. Even though there is a small possibility of a spectacular death, the emotions rising are worth it. There is a bigger possibility of dying in a car crash, but driving is a necessity, so I am willing to use it.

I found out that I don’t like people who believe to talk facts about thigs they’re ignorant of. That counts for me as well. That is for example why I don’t vote for policies I’m don’t know anything about. And if I have the choice to act on something, that action including an undeniable risk factor, without the knowledge of the thematic of the action, I tend not to act.
However, I believe that the most important thing is fun. And in this regard, it is more valuable to regret taken actions over untaken ones. Like when you’re a amazing singer but are to scared to take the risk to fail audition, due to a high risk.
There are numerous risk factor calculator and algorithms we can use, but I usually don’t use them, unless there is a really really big decision to take.

I guess my philosophy is that life is complicated, and I can’t know everything. Thus, I can’t take only the right decisions and failures are inevitable. And even though you could try to maximize the positive outcomes, the energy and time invested would not result in an increase of Mental health and happiness.

 

[Polaris]

I so arrange things that I never meet with uncertainty and risk. I'm allergic to them. If, in spite of that, I meet with uncertainty and risk, my approach is entirely specific to the particular type of uncertainty and risk I find myself facing. I have no overarching philosophy and no reason to change that.

 

[rav3n]

It's a risk/return calculation since living has inherent risk. There's also contingency planning, hoping for the best but ensuring that you're covered if it turns out poorly.

 

[ygolo]

To push things in a really abstract direction for a bit. There are philosophically speaking multiple viable interpretations of quantum mechanics. One of the ones getting more popular lately, especially with evangelists for this interpretation like Sean Carroll, is the interpretation by Hugh Everett, referred to as the many world interpretation. The basic idea is that reality branches from a superposition of possible states of the system being measured, into many branches of entangled states of environment, measurement apparatus, and system being measured.

As part of this notion, there is an idea of Quantum suicide. It is the notion, that if you rely on a branching of a wavefunction to keep you alive, no matter how improbable, the only conscious versions of you will be there to reflect upon it. In this interpretation of quantum mechanics, you have some limited form of immortality.

So, what then, provides the ethical backing of not participating in such an activity if you also firmly believed in the MWI? My answer to that is that I do not have proprioception, and therefore no rights to make decisions for the other me's past the branching point, and therefore it is unethical for me to put myself at risk for the same reason it would be unethical for me to put others at risk in that way.

 

[The Cat]

I compartmentalize reflexively. I don't know if its healthy or not. But it is efficient.

 

[Peter Deadpan]

Oh I just don't do this and instead make the dumbest decisions possible all the time for a consistently disappointing outcome.

 

[anticlimatic]

When life hands you uncertainty, start calculating odds.

 

[ygolo]

There is a question of what you do after you calculate the odds and look at risk vs return. Contingency planning was brought up.

I think another important concept is the notion is antifragility.

Simply, antifragility is defined as a convex response to a stressor or source of harm (for some range of variation), leading to a positive sensitivity to increase in volatility (or variability, stress, dispersion of outcomes, or uncertainty, what is grouped under the designation "disorder cluster"). Likewise fragility is defined as a concave sensitivity to stressors, leading to a negative sensitivity to increase in volatility. The relation between fragility, convexity, and sensitivity to disorder is mathematical, obtained by theorem, not derived from empirical data mining or some historical narrative. It is a priori.

— Taleb, N. N., Philosophy: 'Antifragility' as a mathematical idea. Nature, 2013 Feb 28; 494(7438), 430-430

A psychologically related notion is Post-Traumatic Growth. which is usually couched in terms like resilience. But I like Nassim Nicholas Taleb's antifragility better.

 

[Tellenbach]

I wear a seat belt because I don't want a cop to stop/hassle/ticket me. That's what motivates me to behave a certain way - the avoidance of being hassled by unpleasant people.

That's pretty much my entire philosophy to life....avoid unnecessary contact with people. Uncertainty, risk, and safety don't register in my thinking. There is nothing I want that I can't already buy or order online. My goal is just to be left alone to enjoy a good book and a bowl of ramen.

 

[ceecee]

What drives your approach to behavior in the face of uncertainty and risk? What is your philosophy towards dealing with uncertain information?

I take the best data and information I have at hand at the time and I go from there. If I have the means to take a risk with a possibly big return (an amount of money vs a large amount of time in case that risk fails) then its likely I'll take that risk. If I'm in my car and am facing a flooded roadway and see a lifted truck barely make it through - nope. That's a stupid risk I wouldn't be willing to take. Mostly, if it's about me and only me, I'm more willing to take a risk. I don't mind them in those circumstances.

If it's about me AND others, less likely. Far less.

Are you consistent with your own stated philosophy regarding how you'd respond to risk?

I'm very consistent with my stated philosophy on risk response. I move forward based on data and create contingency plans for as much as possible. It doesn't really matter what the specifics of the risk are - only who else will be impacted and how much. I'm leaving out things like sunk cost fallacy which ruin decision making, especially in a risky situation and I don't generally honor other's investments in this fashion either.

 

[ygolo]

A great sale is going on for an interesting kindle book on the subject: https://smile.amazon.com/Decision-M...VJFJV9F8R48&psc=1&refRID=WQ57QDMKDVJFJV9F8R48

For me, it was free. Perhaps it is for you too.

 

[Justin of Flavia Neapolis]

 

[ceecee]

A great sale is going on for an interesting kindle book on the subject: https://smile.amazon.com/Decision-M...VJFJV9F8R48&psc=1&refRID=WQ57QDMKDVJFJV9F8R48

For me, it was free. Perhaps it is for you too.

It appears to be free for me too, I'll get it.

 

[RadicalDoubt]

For me it really depends on what the risk is and what the reward is on the other side. Most of the time, I'm pretty risk averse, and this is probably because what I consider "risky" lies mostly in the physical plane. I'm a researcher and have been known to be excessively cautious when I'm not in my comfort zone or don't have a full understanding of what I'm working with. I don't really know a ton about stocks, so placing a large deal of stocks automatically seems like a dumb decision to me. A lot of people enjoy cliff diving and come out unscathed in the proper locations, but even if I could swim, I probably wouldn't do that either because the thrill offers me no reward and, based on my ability to navigate the physical world and awful spacial reasoning, I'd probably end up drastically injured anyway just because it's me. Even debates and arguments, I won't throw my cards in the table unless I'm certain I have all my information straight and have a lot of background knowledge because I'd probably make an ass out of myself. 75% of the time, maybe more, I'm probably not going to take the risk. I don't take my chances unless I'm pretty sure I'll get what I want and I'll walk out with minimal issues if I don't.

Nonthelesss, the 25% happens when I can be pretty hasty. If the reward's enough and the risk isn't "high" in my mind, I'll probably take it. Best example is with food. I have a lot of allergies, both known and unknown. Nonetheless, I'm super adventurous, I try something new when I can and am often careless in reference to my allergies. Consistent to the above, normally I'm pretty sure I'll walk out with tolerable issues, but really what drives the decision is the desire. The reward is greater in my eyes than the risk (but often I'm criticized for this). I'll take the walk at night through dark streets for efficiencies sake, I'll drink the milk that "expired" 4 days ago, if I'm confident in myself and my safety (even if others don't agree), sometimes I'm not even attentive to the risk at hand.

 

[Maou]

I try to cover all bases, and position myself in the most potential/least potential for change. I don't take many risks, I am rather cautious overall.

For example, while driving. I will maneuver till I am in a position where I am least likely to be hit, or slowed down etc. If I cannot get in a favorable position, I switch to the position that has the most potential for escape from the current unfavorable position.

In terms of stocks, I am more of a portfolio person. Things are too interconnected to be putting all your eggs in one basket. I always expect the worse, and prefer slow consistency over gambling.

In the tmes I do take a risk, I tend to go big without any real planning. I am talking zero sum big. Though I only have done it a few times, I have achieved what I wanted.

In terms of risk and uncertainty in debate. I am not concerned that much with being right. I learn hands on, so I learn more through failure than anything else. I have to sharpen myself against others.