Yeah, cmon snake eye!
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The million, without a doubt. I could pay all off my mortgage, student loans, kid’s education and even a moderate interest rate on what’s left (assuming we’re talking post tax) would be enough to match a sizable chunk of my salary without touching the principal. It would grant me incredible freedom.
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And… this is EXACTLY why the rich get richer. Once you have financial security, you can take far greater risk with far greater reward.
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Expected value of the $1 million button: $1 million. Expected value of the $50 million button: $25 million. Easy choice for a mathematician.
But if you’re talking real life, yeah, for some people $1 million would be truly life-changing, while for others it would be merely a modest improvement.
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i’ll take the mil and keep fishing til it’s all gone.
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The only reason to go for 50 million is if you don’t actually need any money.
If you have any debts or are underfunded for retirement then the million would give you a huge boost to get your finances in order. You may have to keep working but you would have room for a job change or extra training etc. It would give anyone way more control of their lives unless they are already set.
50 million is a silly amount no one really needs anyway. Even taking account of several disabled family members I’d like to set up trusts for I wouldn’t need nearly that much.
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Bingo. Even stories about so-called “self-made” billionaires often downplay what a huge advantage something as simple as “being able to count on one’s family to take them in if the whole startup goes south” can be for a 20something entrepreneur.
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My first question would be “what else happens when you push the button?”
Oh, and since I’ve brought that up:
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Somewhere in the recesses of my mind, from 30+ years ago, my high school Econ teacher is talking about opportunity cost…
That makes me think of this more as a question of “Can I afford to lose $1,000,000?”
The answer is clearly “no”, and thus I have my answer.
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Most mathematicians I have met aren’t exceedingly wealthy so I bet they would have more variables than just the numerical expected value 
(the rest of this isnt a reply to you but i stink at quoting)
You are guaranteed 1 million at the start of this.
So now that you have a million extra dollars, Do you have enough assets to gamble 1 million on a 50/50 bet with a massive return?
The starting value of your savings and age puts a massive weight on the lifetime value of the two buttons.
For many people the expected lifestyle values are: A guaranteed comfortable life OR a 50% chance of a lifetime of continued financial hardships.
I bet a large fraction of people (even math majors ) with mortgages and kids would take the million even with pretty high incomes.
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Welcome to Team Glass Half Empty
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The concept is loss aversion. Usually in economics classes it is done with a slightly more complicated choice. But it was an early result of experimental economics where the most common choice was not the purely “hyper-rational” one.
Personally I would choose the $1 million because the possibility of being the 50% that loses is too painful to think about.
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Even at 99 percent chance at the 50 million, I would choose the one million. That is more than enough money for me.
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I’ve been watching Price Is Right from the late 70s early 80s,. There’s a 24/7 channel.
There’s a game where you get a guaranteed 2 to 3 grand in prizes or go for the car. A lot of people take the sure thing.
The hardest thing is if you take the sure thing Bob shows you if you would have won. It’s fun to watch.
For those of picking the sure thing would you want to see if you would have won the 50 million?
I don’t think I’d want to know.
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In decision making studies, we compare the mathematically ‘proscriptive’ decision making versus the human ‘descriptive’ decision making to measure the differences. Mathematical optimality doesn’t necessarily result in human satisfaction. There’s utility functions to help the mathematics line up.
Anyone who’s interested in this should really check out behavioral economics & Kahneman’s “Thinking, Fast & Slow”
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I have the worst luck and I always insert the USB plug in upside down. I wouldn’t take any chances. Instant $1 Million Dollars for me, please.
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The value of the 50 million is either 50 million or Zero - Why would it be the average of the two? 25 million is not an option. ( I would pick the million btw - I couldn’t live with having it thrown away should I get Zero with the 50)
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Oh, fundamental law of physics requires USB plugs need 3 tries, 2 flips. No luck involved.
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Honestly, the money wouldn’t be too life changing for me either way. Not because I’m rich, I’m not, but because the way I want to live my life doesn’t require that much money.
Yes, with $50 million I could retire tomorrow and live with much more luxury.
But with $1 million I’d never incur any debt again, I could live how I envisioned living with very comfortable margins for saving, and I’d be on track to retire by 50. Also, I don’t actually want to retire at 35. And I’d still be in a position to quit any job I didn’t want to be in, or take some extended time off if I want to.
@lecti That’s because they’re 4-dimensional.
Edit to add: on reflection, if you instead waited until right before I was planning to retire anyway, and offered me the same choice, my preference would probably reverse itself.
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It means if a large number of people all gambled on the $50 million, on average they would get about $25 million each.
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