Re:Germany is not as stable as we think. Just ask its preppers
by goatlover on Wednesday September 22, 2021 @02:53AM
(#28613722)
But should you get insurance in case a meteor hits your house? Fires happen often enough, but some events are low enough probability not to worry about. A house being destroyed by a meteor strike isn't worth spending money on.
[ Parent
| on HN ]
Re:Germany is not as stable as we think. Just ask its preppers
by fighterpilot on Wednesday September 22, 2021 @03:19AM
(#28613849)
X = P(bad_outcome) * magnitude_of_badness
Y = your net worth
You can trade-off one with the other.
People with lots of Y will be more happy to reduce Y in order to reduce X, because the marginal utility of Y declines with larger values of Y, whereas marginal utility of X remains roughly the same irrespective of values of Y.
> Fires happen often enough, but some events are low enough probability not to worry about.
This ignores the second part of X, which is magnitude_of_badness. Your house burning down has a smaller magnitude_of_badness than society collapsing which will likely lead to death.
It's also ignoring the marginal utility of wealth for large values of Y. Even if X is small, people with large Y will be more happy to reduce Y in order to reduce X.