updated image on ergod post

categories/economics/index.html

@@ -249,7 +249,7 @@ <h2 class="post-title">Ergodicity and Insurance</h2>
     &nbsp;|&nbsp;<i class="fas fa-clock"></i>&nbsp;2&nbsp;minutes
 
 
-    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;216&nbsp;words
+    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;243&nbsp;words
 
 
 

index.html

@@ -255,7 +255,7 @@ <h2 class="post-title">Ergodicity and Insurance</h2>
     &nbsp;|&nbsp;<i class="fas fa-clock"></i>&nbsp;2&nbsp;minutes
 
 
-    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;216&nbsp;words
+    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;243&nbsp;words
 
 
 

post/2023-07-19-ergodicity-and-insurance/index.html

@@ -60,7 +60,7 @@
   "headline": "Ergodicity and Insurance",
   "description" : "I read this post on LinkedIn by Andreas Tsanakas that referenced a paper by Ole Peters titled Insurance as an Ergodicity Problem.\nIt really should be titled financial transactions as an ergodicity problem: A way to model why people transact in financial markets (buy insurance, etc) without needing to appeal to concavity of utility functions and risk-aversion. It also explains how saving part of your income in each time period and investing only a fraction of your wealth in any gamble makes sense (a type of self-insurance) when the outcomes have multiplicative and not additive impacts on your life as it surely does in the real world.",
   "inLanguage" : "en",
-  "wordCount":  216 ,
+  "wordCount":  243 ,
   "datePublished" : "2023-07-19T00:00:00",
   "dateModified" : "2023-07-19T00:00:00",
   "image" : "https:\/\/www.codelooper.com\/img\/redplane.png",
@@ -276,7 +276,7 @@ <h1>Ergodicity and Insurance</h1>
     &nbsp;|&nbsp;<i class="fas fa-clock"></i>&nbsp;2&nbsp;minutes
 
 
-    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;216&nbsp;words
+    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;243&nbsp;words
 
 
 
@@ -304,7 +304,7 @@ <h1>Ergodicity and Insurance</h1>
       <article role="main" class="blog-post">
         <p>I read this post on <a href="https://www.linkedin.com/feed/update/urn:li:activity:7085565022042472448?updateEntityUrn=urn%3Ali%3Afs_feedUpdate%3A%28V2%2Curn%3Ali%3Aactivity%3A7085565022042472448%29">LinkedIn</a> by Andreas Tsanakas that referenced a paper by Ole Peters titled <a href="https://tinyurl.com/yc65c2h3">Insurance as an Ergodicity Problem</a>.</p>
 <p>It really should be titled financial transactions as an ergodicity problem: A way to model why people transact in financial markets (buy insurance, etc) without needing to appeal to concavity of utility functions and risk-aversion. It also explains how saving part of your income in each time period and investing only a fraction of your wealth in any gamble makes sense (a type of self-insurance) when the outcomes have multiplicative and not additive impacts on your life as it surely does in the real world.</p>
-<p>I made a spreadsheet to illustrate the main points in the paper (<a href="/post/2023-07-19-ergodicity-and-insurance/Ergodicity.xlsx">Ergodicity Excel Model</a> ) which plots four random multiplicative series and 4 of the same with savings and withdrawals that would be similar to paying a premium in good years and getting an indemnity in poor years. I also tested the <a href="https://en.wikipedia.org/wiki/Kelly_criterion">Kelly Criterion</a> which might be the optimal solution (betting an optimal proportion of the wealth in each time period). The model could be made more realistic but I think it illustrates the point that using expected values (arithmetic average) leads to the wrong conclusions in some cases where there are multiplicative impacts in a dynamic system.</p>
+<p>I made a spreadsheet to illustrate the main points in the paper (<a href="/post/2023-07-19-ergodicity-and-insurance/Ergodicity.xlsx">Ergodicity Excel Model</a> ) which plots four random multiplicative series and 4 of the same with savings and withdrawals that would be similar to paying a premium in good years and getting an indemnity in poor years. I also tested the <a href="https://en.wikipedia.org/wiki/Kelly_criterion">Kelly Criterion</a> which might be the optimal solution (betting an optimal proportion of the wealth in each time period). The model could be made more realistic but I think it illustrates the point that using expected values (arithmetic average) leads to the wrong conclusions in some cases where there are multiplicative impacts in a dynamic system and that some forms of exchanges is motivated by individual&rsquo;s long-term thinking where expected values over groups may not be a good model for how people behave.</p>
 <img src="images/ergodicity_series.png" alt="ergodicity_series" width="80%"/>
 
 

post/index.html

@@ -268,7 +268,7 @@ <h2 class="post-title">Ergodicity and Insurance</h2>
     &nbsp;|&nbsp;<i class="fas fa-clock"></i>&nbsp;2&nbsp;minutes
 
 
-    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;216&nbsp;words
+    &nbsp;|&nbsp;<i class="fas fa-book"></i>&nbsp;243&nbsp;words