Improbable Events Research Articles

Corporate real estate black swan strategies: Beyond probability and resilience

Corporate organisations operate in a dynamic competitive global environment where real estate decisions form an important part of a successful business operation. Fundamental considerations cover the drivers of possible disruption from core economic activity, structural change and unexpected (black swan) events. With documented increases in the frequency and magnitude of unforeseen, rare and extreme black swan events, this research examines an antifragility corporate real estate strategy that looks beyond likelihood and resilience to opportunities to manage and embrace key adverse known unknown random black swan events. Suggested strategies including modular locational operation units, knowledge sharing and real estate partnerships can form part of an antifragility real estate framework and assist global organisations to succeed where competitors fail in a world affected by increasingly large, highly improbable and unpredictable events.

Practicing Possibilities: Parents’ Explanations of Unusual Events and Children’s Possibility Thinking

Young children tend to judge improbable events to be impossible, yet there is variability across age and across individuals. Our study examined parent–child conversations about impossible and improbable events and links between parents’ explanations about those events and children’s possibility judgments in a reasoning task. Regression analyses revealed that parents’ speculation about potential mechanisms for improbable events during a parent–child book-sharing activity predicted children’s possibility judgments for similar events in an individual task and accounted for more of the variance than children’s age. Also, parents’ skepticism regarding mechanisms for impossible events was negatively correlated with children’s judgments about the possibility of improbable events. Additionally, children’s overall causal justifications for their judgments were correlated with parents’ talk about speculative mechanisms. Results suggest the importance of conversation with parents for young children’s developing understanding of the distinction between impossible and improbable.

An Evidence-Based Approach to Well-Integrity Risk Management

Summary The Paris basin (France) is a particularly challenging setting for oil production: Besides lying under a metropolis of 12-million people, it is also exploited for low-temperature geothermal energy and is crossed by a deep, high-quality drinking-water aquifer of strategic importance, the Albian-Neocomian. Vermilion, the biggest producer in the area, undertook in 2012 a basinwide well-integrity risk-management project with the goal of understanding and minimizing the risk of freshwater-aquifer pollution. The Paris basin operations include 20 fields, for a total of 289 active wells, more than half of which were drilled in the 1980s. The objectives of the leakage risk assessment are twofold: First, identify high-risk scenarios and “must act” wells that require immediate intervention; second, adopt lean (i.e., eliminating waste) prevention and mitigation measures that satisfy the local regulator. The risk-assessment methodology is based on scenarios (i.e., ways in which the hazards, brines or hydrocarbons, can cause damage to targets, the freshwater aquifers). Each scenario involves the failure of a number of barriers with the function to prevent or mitigate damage. In this approach, evidence from in-depth failure analysis is used to build and calibrate scenarios, as well as to validate degradation mechanisms and understand their dynamics. Evidence considered is not limited to drilling reports and wireline logs, but includes all observations, measurements, and weak signals that one can use to test assumptions on the presence, absence, or aging of well integrity. Evidence-based scenarios are complemented by known failure mechanisms, thus reducing the risk of “black swans,” very improbable but catastrophic events, even though their probability is constrained by observed behavior during the 4,000 well years of operations in the basin. The criticality (product of probability and severity) of each applicable scenario is then computed by use of an exhaustive database of the characteristics of each well, resulting in a complete risk profile for the basin. The risk-assessment process revealed that casing corrosion caused by brine injection is the biggest driver of well-integrity risk; it also allowed tailoring effective prevention and mitigation actions: For instance, the criticality of scenarios is reduced to an acceptable level if the time between tubing failure and injection stop is kept to 3 months or less. Furthermore, the analysis helps define the role of periodic logging and thus reduce possible waste (i.e., actions that do not contribute to understanding, preventing, or mitigating risk). The evidence-based approach, since applied to another French basin, has proved effective for managing risk at the basin level, by cutting a middle way between universal checklists and the excessively narrow focus of well-by-well analysis: The former are too large and hazy and may hide real dangers among hardly applicable generalities, whereas the latter tends to be expensive and unsystematic and misses recurring patterns. Heavy-duty analytics and modeling are used most efficiently on focused and specific failure analyses to understand the dominant phenomena, which one can then use to paint a quantitative and consistent picture at the level of a field or basin.

The golden rule of forecasting: Objections, refinements, and enhancements

In providing a “golden rule” for forecasting, Armstrong, Green, and Graefe (this issue) raise aspirations that reliable forecasting is possible. They advocate a conservative approach that mainly involves extrapolating from the present. We comment on three issues that relate to their proposed Golden Rule: its scope of application, the importance of highly improbable events, and the challenges of communicating forecasts.

THE EPISTEMIC ANALYSIS OF LUCK

AbstractDuncan Pritchard has argued that luck is fundamentally a modal notion: an event is lucky when it occurs in the actual world, but does not occur in more than half of the relevant nearby possible worlds. Jennifer Lackey has provided counterexamples to accounts which, like Pritchard's, only allow for the existence of improbable lucky events. Neil Levy has responded to Lackey by offering a modal account of luck which attempts to respect the intuition that some lucky events occur in more than half of the relevant nearby possible worlds. But his account rejects that events which are as likely as those in Lackey's examples are lucky. Instead, they are merely fortunate. I argue that Levy's argument to this effect fails. I then offer a substitute account of the improbability condition which respects this intuition. This condition says that the relevant notion of probability for luck is epistemic.

Science is innate!

AbstractNo abstract.

What are the chances?The Improbability Principle Why Coincidences, Miracles, and Rare Events Happen Every Day David J. Hand Scientific American/Farrar, Straus and Giroux, 2014. 283 pp.

What are the chances?The Improbability Principle Why Coincidences, Miracles, and Rare Events Happen Every Day <i>David J. Hand</i> Scientific American/Farrar, Straus and Giroux, 2014. 283 pp.

Writing Indigenous Vampires: Aboriginal Gothic or Aboriginal Fantastic?

The usual postmodern suspicions about diligently deciphering authorial intent or stridently seeking fixed meaning/s and/or binary distinctions in an artistic work aside, this self-indulgent essay pushes the boundaries regarding normative academic research, for it focusses on my own (minimally celebrated) published creative writing’s status as a literary innovation. Dedicated to illuminating some of the less common denominators at play in Australian horror, my paper recalls the creative writing process involved when I set upon the (arrogant?) goal of creating a new genre of creative writing: that of the ‘Aboriginal Fantastic’. I compare my work to the literary output of a small but significant group (2.5% of the population), of which I am a member: Aboriginal Australians. I narrow my focus even further by examining that creative writing known as Aboriginal horror. And I reduce the sample size of my study to an exceptionally small number by restricting my view to one type of Aboriginal horror literature only: the Aboriginal vampire novel, a genre to which I have contributed professionally with the 2011 paperback and 2012 e-book publication of That Blackfella Bloodsucka Dance! However, as this paper hopefully demonstrates, and despite what may be interpreted by some cynical commentators as the faux sincerity of my taxonomic fervour, Aboriginal horror is a genre noteworthy for its instability and worthy of further academic interrogation. (first paragraph)

Mesoscale modeling: a study of particle generation and line-edge roughness

A lattice-type Monte Carlo–based mesoscale model and simulation of the lithography process have been adapted to study the insoluble particle generation that arises from statistically improbable events. These events occur when there is a connected pathway of soluble material that envelops a volume of insoluble material due to fluctuations in the deprotection profile. The simulation shows that development erodes the insoluble material into the developer stream and produces a cavity on the line edge that can be far larger than a single polymer molecule. The insoluble particles can coalesce to form aggregates that deposit on the wafer surface. The effect of the resist formulation, exposure, postexposure bake, and development variables on particle generation was analyzed in both low- and high-frequency domains. It is suggested that different mechanisms are dominant for the formation of line-edge roughness (LER) at different frequencies. The simulations were used to assess the commonly proposed measures to reduce LER such as the use of low molecular weight polymers, addition of quenchers, varying acid diffusion length, etc. The simulation can be used to help set process variables to minimize the extent of particle generation and LER.

Statistical Keyword Matching using Automata

This paper proposes to statistically gauge the degree of matching of keywords in input strings using finite automata, in order to grade strings in the order of relevance with respect to the given keyword. The non-extensive entropy with the Gaussian information gain function proposed by Susan and Hanmandlu for the representation of regular patterns is used by us as the statistical measure. The improbable events falling in the ‘bell of the Gaussian information gain function’ are highlighted by this non-extensive entropy. The keywords which are the improbable events in a composite string are adequately represented by this statistical measure. The result is an improvised and more indicative grading than the combined pattern recognition tool of automata and reinforced learning used by several researchers.

The Human Brain Encodes Event Frequencies While Forming Subjective Beliefs

To make adaptive choices, humans need to estimate the probability of future events. Based on a Bayesian approach, it is assumed that probabilities are inferred by combining a priori, potentially subjective, knowledge with factual observations, but the precise neurobiological mechanism remains unknown. Here, we study whether neural encoding centers on subjective posterior probabilities, and data merely lead to updates of posteriors, or whether objective data are encoded separately alongside subjective knowledge. During fMRI, young adults acquired prior knowledge regarding uncertain events, repeatedly observed evidence in the form of stimuli, and estimated event probabilities. Participants combined prior knowledge with factual evidence using Bayesian principles. Expected reward inferred from prior knowledge was encoded in striatum. BOLD response in specific nodes of the default mode network (angular gyri, posterior cingulate, and medial prefrontal cortex) encoded the actual frequency of stimuli, unaffected by prior knowledge. In this network, activity increased with frequencies and thus reflected the accumulation of evidence. In contrast, Bayesian posterior probabilities, computed from prior knowledge and stimulus frequencies, were encoded in bilateral inferior frontal gyrus. Here activity increased for improbable events and thus signaled the violation of Bayesian predictions. Thus, subjective beliefs and stimulus frequencies were encoded in separate cortical regions. The advantage of such a separation is that objective evidence can be recombined with newly acquired knowledge when a reinterpretation of the evidence is called for. Overall this study reveals the coexistence in the brain of an experience-based system of inference and a knowledge-based system of inference.

Fractional field equations for highly improbable events

Free and weakly interacting particles perform approximately Gaussian random walks with collisions. They follow a second-quantized nonlinear Schrödinger equation, or relativistic versions of it. By contrast, the fields of strongly interacting particles extremize more involved effective actions obeying fractional wave equations with anomalous dimensions. Their particle orbits perform universal Lévy walks with heavy tails, in which rare events are much more frequent than in Gaussian random walks. Such rare events are observed in exceptionally strong windgusts, monster or rogue waves, earthquakes, and financial crashes. While earthquakes may destroy entire cities, the latter have the potential of devastating entire economies.

Electrophysiological correlates of anticipating improbable but desired events

Psychological studies have emphasized that motivation is regulated by the anticipation of the emotional impact from the possible occurrence of unexpected rewarding events. Here, we scrutinized the existence of a corresponding neural signal by means of event-related potentials (ERPs) and computational modeling. In the first experiment, we designed a task that manipulated the probability of gaining a monetary reward and measured ERPs during anticipation and at reward delivery. A sustained frontocentral neural activity (i.e., the stimulus preceding negativity, SPN) was evidenced during the anticipation period. Critically, the SPN was found to increase in amplitude as the reward became more unexpected. Changes in the SPN were found to be predictive of individual differences in risk seeking, suggesting that a greater risk attitude involved a greater motivational state for receiving an improbable reward. In the second experiment, SPN results associated with unexpected monetary gains were replicated in a condition in which participants avoided monetary losses and the occurrence of unexpected rewards was also associated with an increase in the amount of self-reported pleasure. These findings support the existence of a neural ERP signature that encodes the process of tuning our motivation to the possibility of receiving a desirable but improbable rewarding outcome.

Flagrant Conduct: The Story of Lawrence v. Texas: How a Bedroom Arrest Decriminalized Gay Americans by Dale Carpenter (review)

Reviewed by: Flagrant Conduct: The Story of Lawrence v. Texas: How a Bedroom Arrest Decriminalized Gay Americans by Dale Carpenter Francisco Valdes Flagrant Conduct: The Story of Lawrence v. Texas: How a Bedroom Arrest Decriminalized Gay Americans. By Dale Carpenter. (New York: W. W. Norton, 2012. Pp. 364. Notes, bibliography, index. ISBN 9780393062083, $29.95 cloth.) As Dale Carpenter's probing account of Lawrence v. Texas makes plain, this landmark case is more queer (i.e., strange or weird) than anyone might have thought before reading this fascinating, well-written book. Quite unexpectedly, the eyepopping details that Carpenter shares with us in Flagrant Conduct add up to a most queer tale in the Queering of U.S. law and society. Flagrant Conduct begins the night of September 17, 1998, when Texas police raided the Houston apartment where Lawrence lived, and ends on June 26, 2003, when Justice Anthony Kennedy announced the U.S. Supreme Court's historic ruling in that case, striking down sodomy laws across the land. Carpenter carefully traces the intricate, multi-layered story each step of the way, but what makes the must-read tale that Carpenter unfolds especially compelling is how the improbable facts of this case produced multiple micro-rebellions and dramatic institutional repudiations against this firmly entrenched tradition of stigma. The first set of surprising choices arises the very night of the arrests, when Lawrence tells the police they have "no right to be here" (75) and then continues to "run his mouth" (77) at the police station, after Officer Joseph Quinn decided to arrest him, in his own home, and forcibly take him to jail that very night—apparently an unprecedented police act under the 143-year history of the Texas sodomy statute. The juxtaposition of Lawrence's and Quinn's improbable choices put the legal case into motion, but the crucial momentum came when [End Page 429] myriad actors within the legal system pushed it along, ensuring its journey to the Supreme Court. The rap sheets against Lawrence and Garner were received by a closeted gay justice-of-the-peace court clerk, who decided to fax the unprecedented charges to his closeted gay boyfriend at the sheriff's office, who in turn decided to share this sensational development with a local gay activist and bartender, who then decided to get attorneys involved. This set of improbable acts thus led to the retention of attorneys, who in turn orchestrated the development of the case with the dutiful yet unlikely participation of the court system itself. First, the justice of the peace agreed to a defense request that the fines imposed on Lawrence and Garner be increased in order to allow an appeal. Then, a closeted lesbian prosecutor agreed to a no-contest plea with a fine that similarly was designed to meet the bare threshold for appellate jurisdiction. Finally, a county criminal judge approved the strategic deal with a wink and a nod, thus setting the stage for the story to culminate as it did. It took each and every choice along this chain of acts to permit the most improbable events—a fair hearing and ultimate victory at the Supreme Court itself. Without Carpenter's exhaustive research, we could not know or appreciate the richness of the "impossible" turns of events making this momentous outcome possible. It was indeed queer that so many disparately placed individuals would act with (sometimes) unwitting synchronicity: as Carpenter explains, in the "normal" course of events, this long chain of "coincidences" would never come to pass. But, as Carpenter demonstrates, these weird, strange, improbable events became a tale of Queer self-empowerment when Lawrence and Garner each rebelled against the forces of structural and internalized homophobia, even though neither had ever before expressed any sense of Queer activism. With Flagrant Conduct, Dale Carpenter provides a service to us all in capturing while still fresh the hidden insights behind this key chapter in the legal history of sexual minority equality in the United States. Appealing to both researches and lay readers with a "just-the-facts" approach, he tells us a good, focused story. In the most salutary of ways, he shows us through this recent historical prism...

Improbable outcomes: Infrequent or extraordinary?

Research on verbal probabilities has shown that unlikely or improbable events are believed to correspond to numerical probability values between 10% and 30%. However, building on a pragmatic approach of verbal probabilities and a new methodology, the present paper shows that unlikely outcomes are most often associated with outcomes that have a 0% frequency of occurrence. Five studies provide evidence that when people complete or evaluate statements describing “improbable” outcomes, based on outcome distributions or expected ranges, they favor extraordinary outcomes that have not occurred in the original sample. For quantitative outcomes that can be ordered on a unipolar dimension, an improbable outcome is typically perceived as having a higher outcome value than those observed. Thus when battery life for a sample of laptop batteries is shown to range from 2.5 to 4.5h, 5 or 6h are considered better examples of “improbable” duration times than those that actually occur in 10% of the cases. Similarly, an improbable exam grade is one that has not yet been observed, rather than one that has been obtained by a small percentage of students. And when climate experts claim that a 100cm increase in sea level by the year 2100 is “improbable”, participants believe that the same experts’ maximum estimates will be much lower. We conclude that judgments of what is improbable suggest outcomes beyond the expected range, rather than simply low frequency outcomes. These results are compatible with a causal (propensity) interpretation rather than a statistical (frequency) interpretation of probabilities.

Battling Tengu, Battling Conceit Visualizing Abstraction in The Tale of the Handcart Priest

sixteenth- or early seventeenth-century Tale of Handcart Priest tells of an eccentric Zen practitioner's encounter with legendary Tarobo, a tengu of Mt. Atago who is attracted to priest because of priest's excessive pride. This article provides a close reading of Tale of Handcart Priest in its historical and literary context, drawing upon such related works as noh plays Kuruma-zo and Zegai, otogizoshi Matsuhime monogatari and Itozakura no monogatari, and puppet play Shuten Doji wakazakari. I discuss significance of tengu, carts, and priests in Japanese textual and pictorial sources from twelfth through eighteenth centuries, as well as possibilities for psychological realism in larger world of medieval Japanese fiction. Taking a psychoanalytic interpretive approach, I argue that in Kuruma-zo soshi and other medieval and Edo-period literary sources, characters' struggles with tengu can often be read allegorically as externalized depictions of those characters' internal struggles with their own demons of conceit.KEYWORDS: tengu-Zen-otogizoshi-nara ehon-setsuwa-noh-Tarobo- Zegaibo-medieval Buddhist fiction(ProQuest: ... denotes non-US-ASCII text omitted.)At some time in sixteenth or early seventeenth century, an anonymous author composed a short work of fiction known as Kuruma-zo soshi ..., The Tale of Handcart Priest. Classified today as an otogizoshi ..., an amorphous and eclectic genre of medieval Japanese prose literature, Kuruma-zo soshi survives in a single illustrated manuscript in possession of Kyoto University Library: a colorful, likely seventeenth-century nara ehon ...,1 pages of which were unbound at an unknown time and mounted to form an exquisite hand scroll. In 1941, manuscript was reproduced in a fine facsimile edition (with a total of three hundred numbered copies), and in 2002, it was photographically reproduced in a series of books devoted to Kyoto University Library collection of otogizoshi (Kyoto Teikoku Daigaku 1941; Kyoto Daigaku Bungakubu Kokugogaku Kokubungaku Kenkyushitsu 2002, 80-116). Yet despite its relative fame in Japan, Kuruma-zo soshi is almost wholly unknown in English-speaking academic world, where, along with most nara ehon, it has been neglected by literary and art historians alike.Kuruma-zo soshi is fantastic tale of an eccentric Zen Buddhist practitioner by name of Kuruma-zo, the Handcart Priest, who is said to have wandered Japan in a rickety two-wheeled cart. story is based, in part, upon noh play Kuruma-zo ..., first recorded performance of which was held in Nara in tenth month of 1514,2 a century or more before transcription of Kyoto University Kuruma-zo soshi manuscript. Like its source play, Kuruma-zo soshi concerns a day in life of an itinerant handcart priest, a type of lowlevel Buddhist renunciant of whom little is now known, but who Tokue Gensei argues was a relatively common figure in late-medieval Japan. Tokue posits that these mendicant beggar-priests employed their carts as both rolling homes and platforms from which to preach, and that in their sermons, they expounded upon metaphorical implications of their carts as vehicles of Buddhist Truth (Tokue 1962; Tokue 2006, 150 and 164). In Kuruma-zo soshi, Handcart Priest confronts a succession of hostile tengu ... (anti-Buddhist, supernatural demon-bird-men) who challenge him on significance of his cart and seek to punish him for his pride. After a protracted battle of wits and magic-a struggle that extends well beyond range of noh play Kuruma-zo-the Handcart Priest succeeds in driving offthe tengu horde.Like many otogizoshi, which are often concerned with otherworldly creatures, magical settings, and improbable events, Kuruma-zo soshi can be seen to function on a symbolic level by depicting Buddhist and psychological abstractions as external, concrete phenomena, allowing audiences privilege of visualizing invisible, or seeing unseen. …

Breaking Monte Carlo - Industry Standard Option Model Limits - Implications for Investors and Corporate Finance

Pushing models to extremes can expose output biases that stem from underlying assumptions. In the case of industry standard option valuation models, long term, high volatility securities provide a stress test vehicle. For instance, in evaluating a stock with 60% volatility, industry standard option valuation models imply that 69.2% of the stock’s value reflects the likelihood that the share price will rise 600% (septuple) within 10 years. For a portfolio of stocks with 60% volatility, industry standard models project roughly 10% of the holdings will septuple over the course of a decade. In dealing with high volatility securities over long time periods, do outcomes projected by industry standard option models match up with empirical observations? Or, are the predicted extraordinary returns for a significant percentage of high volatility stocks artifacts of a slant in the models’ foundations? Do both an assumption of a log normal random distribution of stock prices and the absence of a “reversion to the mean” link to fair value make industry standard option models systematically overweight improbable upside events? Is reported volatility biased upwards when measured under the presumption of a log normal distribution of stock prices, and does that bias in measured volatility also contribute to overweighting improbable upside stock price events? Considerable discussion has been given to the “black swan” issue (systematic underweighting of improbable events), but the issue here is just the reverse. What are the implications? If widely used option pricing models are systematically skewed to overestimate the likelihood of upside stock price appreciation over long time periods, can investors with superior models find arbitrage opportunities? Are long term executive and employee option packages overvalued with, consequently, excessive expense recognized at grant? Might corporate finance managers find compelling capital strategies that existing pricing models erroneously dismiss?

Flying shells: historical dispersal of marine snails across Central America

The geological rise of the Central American Isthmus separated the Pacific and the Atlantic oceans about 3 Ma, creating a formidable barrier to dispersal for marine species. However, similar to Simpson's proposal that terrestrial species can 'win sweepstakes routes'-whereby highly improbable dispersal events result in colonization across geographical barriers-marine species may also breach land barriers given enough time. To test this hypothesis, we asked whether intertidal marine snails have crossed Central America to successfully establish in new ocean basins. We used a mitochondrial DNA genetic comparison of sister snails (Cerithideopsis spp.) separated by the rise of the Isthmus. Genetic variation in these snails revealed evidence of at least two successful dispersal events between the Pacific and the Atlantic after the final closure of the Isthmus. A combination of ancestral area analyses and molecular dating techniques indicated that dispersal from the Pacific to the Atlantic occurred about 750 000 years ago and that dispersal in the opposite direction occurred about 72 000 years ago. The geographical distribution of haplotypes and published field evidence further suggest that migratory shorebirds transported the snails across Central America at the Isthmus of Tehuantepec in southern Mexico. Migratory birds could disperse other intertidal invertebrates this way, suggesting the Central American Isthmus may not be as impassable for marine species as previously assumed.

Young children discriminate improbable from impossible events in fiction

Can young children discriminate impossible events, which cannot happen in reality, from improbable events, which are unfamiliar but could possibly happen in reality? When asked explicitly to categorize these types of events, 4-year-olds ( N = 54) tended to report that improbable events were impossible, consistent with prior results ( Shtulman & Carey, 2007). But when presented with stories made up of improbable events, children preferred to continue these stories with additional improbable events rather than with impossible events, demonstrating their sensitivity to the difference between the two types of events. Children were indifferent between continuing these stories with additional improbable events or with ordinary, possible events. Children's differential performance on the story and categorization tasks suggests that they possess some knowledge of the distinction between improbable and impossible but find it difficult to express this knowledge without a supportive context.

Phylogeny and palaeoecology of Polyommatus blue butterflies show Beringia was a climate-regulated gateway to the New World

Transcontinental dispersals by organisms usually represent improbable events that constitute a major challenge for biogeographers. By integrating molecular phylogeny, historical biogeography and palaeoecology, we test a bold hypothesis proposed by Vladimir Nabokov regarding the origin of Neotropical Polyommatus blue butterflies, and show that Beringia has served as a biological corridor for the dispersal of these insects from Asia into the New World. We present a novel method to estimate ancestral temperature tolerances using distribution range limits of extant organisms, and find that climatic conditions in Beringia acted as a decisive filter in determining which taxa crossed into the New World during five separate invasions over the past 11 Myr. Our results reveal a marked effect of the Miocene–Pleistocene global cooling, and demonstrate that palaeoclimatic conditions left a strong signal on the ecology of present-day taxa in the New World. The phylogenetic conservatism in thermal tolerances that we have identified may permit the reconstruction of the palaeoecology of ancestral organisms, especially mobile taxa that can easily escape from hostile environments rather than adapt to them.