An Empirical Approach to the St. Petersburg Paradox

Document Type

Article

Department or Administrative Unit

Mathematics

Publication Date

2011

Abstract

The St. Petersburg game is a probabilistic thought experiment. It describes a game which seems to have infinite expected value, but which no reasonable person could be expected to pay much to play. Previous empirical work has centered around trying to find the most likely payoff that would result from playing the game n times. In this paper, we extend this work to the distribution of all possible values which could result from this experiment. We use this distribution—with a surprising fractal-like pattern—to examine the unlikely nature of the most famous experiment on this game, the results of the Compte de Buffon's playing the game 2048 times.

Comments

This article was originally published in The College Mathematics Journal. The full-text article from the publisher can be found here.

Due to copyright restrictions, this article is not available for free download from ScholarWorks @ CWU.

Journal

The College Mathematics Journal

Copyright

© The Mathematical Association of America

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