A Bridge from Monty Hall to the Hot Hand: Restricted Choice, Selection Bias, and Empirical Practice
IGIER Working Paper
33 Pages Posted: 2 Jan 2016 Last revised: 29 Oct 2017
Date Written: October 27, 2017
We show how classic conditional probability puzzles, such as the Monty Hall problem, are intimately related to the hot hand selection bias Miller and Sanjurjo (2015). We explain the connection by way of the principle of restricted choice, an intuitive inferential rule from the card game bridge, which we show is naturally quantified as the updating factor in the odds form of Bayes Rule. We illustrate how, just as the experimental subject fails to use available information to update correctly when choosing a door in the Monty Hall problem, we as researchers can neglect analogous information when designing experiments, analyzing data, and interpreting results.
Keywords: Hot Hand, Hot Hand Fallacy, Monty Hall Problem, Selection Bias, Principle of Restricted Choice, Contract Bridge, Berkson's Paradox, Boy-or-Girl Paradox, Betrand's Box Paradox, Alternation Bias, Gambler's Fallacy, Streak Reversal Paradox, Google Problem, ESP, Psi, Precognition
JEL Classification: C11, C13, C18, C52, C9, D83
Suggested Citation: Suggested Citation