During summer hiatus I have promised to look into a data set I have extracted from one particular Facebook contest. While many Facebook contests are not based on any logical reasoning, this contest appeals to me as it appears to require at least some thought or expertise.

Last time I have briefly explored the data set. Now I will try to build models for the event-space observations.

What we are writing about on Physics of Risk might seem a bit abstract. In some cases it actually is, but these seemingly abstract exercises help to make better decision for every day life problems. This time we invite you to watch a SciShow video in which some applications of Game Theory to enhance security are discussed.

During summer hiatus I have promised to look into a data set I have extracted from one particular Facebook contest. While many Facebook contests are not based on any logical reasoning, this contest appeals to me as it appears to require at least some thought or expertise. As far as I am aware, in Lithuanian schools, sets of linear equations are typical 8th grader problem. Even this low threshold allows to reasonably expect to observe herding behavior in the answers, because the ones who lack expertise will simply copy what the others have publicly written.

This contest is particularly interesting to me, because either intentionally or unintentionally there are infinitely many correct answers. It is so as the problem in the contest involves less equations (two) than unknowns (three). Hence there are no reasonable arguments for why to prefer one answer over the others.

Network models were, and still are, a prominent part of Physics of Risk. This time we would like to suggest trying another excellent interactive web app by Nicky Case, which explores how network structures facilitate or hinder contagion processes in the societies.

Wisdom and/or madness of crowds app »

See other interesting interactive tools authored by Nicky Case

We continue our series of posts on order book models by considering an order book model proposed by Tobias Preis [1], which is able to reproduce log-normal order book side profile. There are more modifications of this model considered in the aforementioned paper [1]. One of them is simpler and reminiscent of the order book model by Cristelli, which was discussed in a previous post, couple of them are more sophisticated and able to reproduce other interesting stylized facts.

It is quite possible that we will discuss some of the modifications sometime later on Physics of Risk, but now let us describe the chosen version of the model proposed by Tobias Preis.