Not that the distinction hugely matters, but I'm intrigued by one of my usual inspirations to blog, the Cafe Hayek blog. There, one of the authors, Don Boudreaux, has far too much wealth it seems, as he's happy to throw $10,000 away on what essentially is a 50-50 bet: That less people will die from violent storms in the next 20 years than did in the previous 20 years.
He then cites some numbers over the last few years as evidence, but the amusing thing is: the numbers exclude Katrina! There's a small look at the data here by another blogger, but that really amounts to just fitting a time trend to some data as opposed to any serious attempt to look at it. If I was looking at that data, then actually I would have taken it had I had the money, and had Katrina not happened. Looking at the period 1991-2000, the numbers for both measures presented have completely flatlined. 1991-2010 is the reference period for Beadreaux. If we imagine that this flatlining will continue, then the average 1991-2000 may well drag 1991-2010 above 2011-2030. If Katrina is excluded though, what are the criteria for excluding future big events (which are bound to happen)?
Overall though, the $10k would need to be a sufficiently small fraction of my wealth for me to be interested in the bet. Why? Am I scared? Not really, it's just because it's a random bet which could go either way. Clearly, as a Christian I believe one should be a good steward of the resources God has blessed me with, and that doesn't rule out gambling if there's an expected positive return, since that is a wise use of money (parable of talents and all). However, when as shown, there has been no trend over the reference period in the variable that is being discussed, then I don't think this is much more than a 50-50 bet, and hence I doubt I would ever, regardless of how wealthy I was, be willing to put money down on such a bet.
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