PREFERENCES Johnny von Neumann -- machine, game theory, dt, optimization -- math John Kemeny -- inventor of BASIC utility for one person ----------- | | | 4.5 | 44 | strategic form payoff apples > oranges an apple > an orange this apple > this orange (= apple813 > orange917 ) UTILITY THEORY u rick u1 u2 utility functions domain: quantity of commodities range: real number; integer? real-valued utility (long dutch tradition, jeremy bentham???) transformation: nonlinearity u(an apple) u(apples) u(apple813) u(ronloui,apple813, Wed Sep 29 18:14:36 CDT 2004) u(ronloui,apple813, Wed Sep 29 18:14:36 CDT 2004,while you are dying in kosovo) mozart >(1) bartok bartok >(2) mendelssohn mendelssohn >(3) mozart mozart-bartok > bartok-mozart . . . menu-dependence u(apple813) = 43.5 lottery: u( { apple812)/.4; apple(813)/.6 } ) = .4*u(applie812) + .6*u(applie813) totality of preference >= is a total order leonard savage -- 1951 found of statistics, dt, 1970 phil of sci, problem of small worlds axioms of preference ordering is total, substitute a lottery for a certainty, you can substitute equivalents in a lottery guarantee that utility is unique up to affine transformation my scoring function is a multiattribute additive weighted utility u(a,b,c) = 5*a + 3*b - 1*c what if regularity isn't real? u(a,b,c) for all in AXBXC PROBABILITY 1 raining dark 2 not-raining not-dark 3 raining not-dark 4 nor-raining dark Borel Set -- prob measure booleans on predicates/propositions -- Lindenbaum/Tarski algebra hw: is there a notion of difference or multiplication in the temperature scale? p(1), p(2), p(3)... frame of discernment medical diagnosis symptoms --> ailments diagnosing failure in sony vaio pcg-505tr, p(S), |S| = ? prob(memory error | bus error) = prob (memory error & bus error) / prob (bus error) bayes rule loui's bad memory: p(good | sweet, red) >= 1 - k - m GIVEN: p(good | sweet) = 1 - k p(good | red) = 1 - m loui's bad memory: p(a | c) >= (1-k)(1-m) GIVEN: p(a | b) = 1-k ; p(b | c) = 1-m independence p(a & b) = p(a) p(b) assume conditional independence: p(cancer | smoking) = p(smoking | smoking, weak person) assuming this is like assuming preferences are transitive! IN OUR REASONING ABOUT THE WORLD: predictive informative causal screening