So once upon a time coke cost only five cents a bottle. The drinking kind! So a vending machine would dispense one bottle for a nickel. Then horrors the price went up to six cents a bottle.
To solve the problem the sole machine on an island was set such that each time you put your nickel in there was a 1 in 6 chance you got nothing. A sailor was there one day only. He put his first nickel in and got nothing. He put his second in and got his coke and left the island the next day bitter about the unfairness of coke machines.
Is the machine fair?
No. Because the machine does not represent to the buyer that there is a chance he will get nothing. It is false advertising if the supplier represents to the consumer purchase conditions that the supplier then fails to meet. It would reasonable to suspect that a dispensing machine offering bererages at an advertised price, is going to dispense said beverage once the payment has been made.
However if the advertising on the machine represented the machine as a game of chance - much like the machines where you get three chances to grab candy with a robot arm - then that would different. It comes down to what a reasonable man would believe are the conditions being represented by the supplier. I think both Von Mises and Keynes would advise this sailor to call the number on the side of the machine and report the fact that he paid for a coke and didn’t receive it. I’m sure the company would be happy to send him a postal order refunding his money. 8*)[/quote]
Ok the sailor would know sorry if I didn’t clarify.
His position would tend to be something to the effect of well it wasn’t fair for me, but I suppose if I lived on the island and were there long term it might be ok. This would exemplify an eclectic view of probability as regards to expected value.
Von Mises was a frequency dogmatist as regards probability. So he would consider the price to be fair as on average the price paid was correct.
Keynes was a belief dogmatist. He is somewhat close to what you are saying. He would say the overall lottery system was fair. But that there are many types of unfairness and that forcing the one day visitor to gamble at the only game in town for a coke is where the unfairness arises.
So for me the expected value of the return is fair. However because the cost is relatively meaningless at a penny a position like a Von Mises would hold is ok. I think the frequency dogmatist view weakens as the relative costs and complexity grow to where people are forced to play the only game in town in a system where the true expected value isn’t easy to determine. This is why as well I think people make many ill considered choices…not so much irrational as not understanding the true expected value of a proposition.
Tiribulus your statement is too vague for me. Make it more specific please.