## Enriching evolutionary games with trust and trustworthiness

October 20, 2013 2 Comments

Fairly early in my course on Computational Psychology, I like to discuss Box’s (1979) famous aphorism about models: “All models are wrong, but some are useful.” Although Box was referring to statistical models, his comment on truth and utility applies equally well to computational models attempting to simulate complex empirical phenomena. I want my students to appreciate this disclaimer from the start because it avoids endless debate about whether a model is true. Once we agree to focus on utility, we can take a more relaxed and objective view of modeling, with appropriate humility in discussing our own models. Historical consideration of models, and theories as well, should provide a strong clue that replacement by better and more useful models (or theories) is inevitable, and indeed is a standard way for science to progress. In the rapid turnover of computational modeling, this means that the best one could hope for is to have the best (most useful) model for a while, before it is pushed aside or incorporated by a more comprehensive and often more abstract model. In his recent post on three types of mathematical models, Artem characterized such models as *heuristic*. It is worth adding that the most useful models are often those that best cover (simulate) the empirical phenomena of interest, bringing a model closer to what Artem called *insilications*.

Read more of this post

## Mathematics in finance and hiding lies in complexity

October 13, 2013 by Artem Kaznatcheev 15 Comments

Sir Andrew Wiles

Arithmeticathat Pierre de Fermat scribbled the statement of his Last Theorem. that the margin was too narrow to contain^{[1]}. In modern notation it is probably one of the most famous Diophantine equations with the assertion that it has no solutions for and as positive integers. A statement that almost anybody can understand, but one that is far from easy to prove or even approach^{[2]}.Read more of this post

Filed under Commentary, Models, Reviews Tagged with application of theory, cstheory, economics, finance, philosophy of math, video