From Probability to Decision Analysis

From Sankhyana Shaastra to Nirnaya Shaastra

Nala Damayanti

Nala lost his kingdom and wealth to brother Pushkara in

game of dice

Makes a deal with King Rituparna Teach charioteering, learn gambling

Challenges Pushkara to a rematch,wins this time, also remarries his wife

“Knowledge I possess of the game of dice, thus is my skill in numbers”

http://karatalaamalaka.wordpress.com/2011/04/20/probability-theory-gambling-and-the-mahabharata/

What tree is this?

Photo by: Jan Ainali

Hint: This is the fruit of the tree

Photo by: J. M. Garg

The Challenge: Estimate number of leaves without actually counting. Rituparna estimated number of leaves as 5 million (panchakoti) and fruits as 2095!

http://karatalaamalaka.wordpress.com/2011/04/20/probability-theory-gambling-and-the-mahabharata/

Rituparna’s demo

Vibhitaka (bibitaki)

Ganesha, the first Bayesian god

Epistemic vs Aleatory Knowledge

Karthik’s challenge - go around the world three times

Goes around his parents three times!

कमर्ण्येवािधकारस्ते मा फलेषु कदाचन | मा कमर्फलहतेुभूर्मार् ते सङ्गोऽस्त्वकमर्िण ||२- ४७||

Our competence lies in action, not in the fruits thereof. Therefore focus on right action, and be not attached to inaction.

Ronald Howard

You cannot judge a decision from the outcome.

Drive Drunk Drive Sober

Bad Decision, Bad Outcome

Crash

Reach Safely

Good Decision, Bad Outcome

Bad Decision, Good Outcome

Good Decision, Good Outcome

There are those who believe that there is something “cold and inhuman” about rational analysis. I believe that to be human is to be reasoning as well as compassionate. My ideal here is Buddha:

“Perhaps the most striking thing about him, to use the words of J. B. Pratt, was his combination of a cool head and a warm heart, a blend which shielded him from sentimentality on the one hand and indifference on the other. He was undoubtedly one of the great rationalists of all times, resembling in this respect no one as much as Socrates. Every problem that came his way was automatically subjected to the cold, analytical glare of his intellect. First, it would be dissected into its component parts, after which these would be reassembled in logical, architectonic order with their meaning and import laid bare (Smith [29]).”

Perhaps Buddha was the first decision analyst.

—Ronald Howard

Rev. Thomas Bayes

Pierre-Simon Laplace

An Essay towards solving a Problem in the Doctrine of Chances, published in

1763 after his death

Modern father of probability theory

E. T. JaynesProbability: The Logic of Science

Prof. Ronald Howard, Stanford University

Named our field and did his first formal Decision Analysis in 1964