Mankiw on a Great Bayes Theorem Example

Lynne Kiesling

Greg Mankiw has a great example of how to use Bayes Theorem, applied to nomination and election markets for the 2008 Presidential race at Tradesports.

Perhaps if we followed Chris Dillow’s advice and taught gambling at school, we would have a more numerate and probabilistically literate population, so people would be more intelligent in interpreting polls, prediction markets, and results of blood tests. Hey, a girl can dream, can’t she?

One thought on “Mankiw on a Great Bayes Theorem Example

  1. Some dreams are mere fantasy; some border on hallucination; others on insanity.

    How about we start small and focus on educating intelligent journalists? Would it be unreasonable to expect journalists to be as intelligent as, say, bloggers? Shouldn’t we reasonably expect those that seek to explain things to us to understand them first? Enquiring minds want to know!

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