RSM341H1 Lecture 9: Lecture 9 Newcomb's Paradox
Document Summary
Box one contains either mm or sh. Taking both boxes always leaves you better off no matter what state you are in. By sure thing principle, should always take both boxes. Imagine boxes are offered by an omniscient alien. Alien can perfectly predict if you are greedy or modest. Based on perfect prediction, alien puts mm in box if you will be modest and sh in box if you are greedy. At point in time when you must choose, money is already in box. Although setup seems to suggest you should choose just opaque box, money is already in box by the time you choose. If alien predicted you would be modest, you are better off being greedy. Since decision is already made, no incentive to violate sure thing principle. Being greedy always results in , being modest always results in mm. Under this scenario, everyone would likely choose modesty.
