Ergodicity - Luca Dellanna  ## Metadata - Author: **Luca Dellanna** - Full Title: Ergodicity - Category: #books - Tags: #game-theory #mathematic #rationality ## Highlights - all our decisions are underpinned by an implicit assumption of a time horizon to optimize for. (Location 41) - performance is subordinate to survival. It is the fastest racer of those who survive that wins races, it is the highest performing employee who doesn’t burn out that becomes the most successful, and so on. (Location 78) - If we make decisions based on what happens over narrow intervals and forget about these “phantom consequences,” we will make bad decisions. Ergodicity is the study of these phantom consequences. (Location 95) - Your individual expected outcome if you play Russian Roulette once is also 1/6 of a death and $5,000. However, if you play it more than once, it begins to decrease. If you play it an infinite amount of times, you will be dead for sure. Your final outcome, what you can walk away with, is $0 and a hole in your head. (Location 194) - A system is ergodic21 if its population outcome coincides with the lifetime outcome of each of its components. Otherwise, it is non-ergodic. (Location 200) - in ergodic systems, you can use the population outcome to make optimal decisions. In non-ergodic systems, you cannot.22 For example, Russian Roulette is non-ergodic because the lifetime outcome differs from the population outcome. If you keep playing it because you fail to grasp its non-ergodicity and mistakenly believe that your lifetime outcome equals your population one, you will end up dead instead of rich. (Location 202) - something working on average doesn’t guarantee it works. (Location 289) - we cannot rely on averages whenever there is a possibility for irreversible damage35. This is because the possibility of irreversible damage makes a context non-ergodic. (Location 327) - Fully relaying on averages and expected outcomes makes sense only in ergodic contexts. In non-ergodic ones, you want to ensure that you make decisions based on an estimate of your lifetime outcome. (Location 399) - Ergodicity is verified if, more or less, every time that you compute a statistical measurement (across space or time), you find the same result. (Location 406) - An injury can cause a skier’s championship to be over, nullifying any future wins he could have collected in the remaining races. (Location 410) - most practical contexts are non-ergodic. Work, sports, relationships, and real life are all non-ergodic. (Location 447)