Raymond B. answered 09/13/20
Math, microeconomics or criminal justice
The "subjective" initial apriori probability in Bayesian statistics is like the null hypothesis in frequentist statistics.
With Bayes Theorem, you get sort of an average of the initial hypothesis & the alternative hypothesis.
Bayes moves away more slowly from Ho, while the frequestist approach rejects Ho and replaces it with Ha.
Bayes sort of averages them to get (Ho+Ha)/2
Frequentist probability is inductive logic. Bayesian probability is deductive logic P(H/E)P(E)=P(E/H)P(H) is a logical tautology.
Take the Monty Hall paradox. You're shown 3 doors, one has a prize behind it, the other 2 have goats. You choose door A. Monty opens door B showing a goat. Should you switch to door C? The frequentist statistical conclusion, such as computer generated with random numbers, says yes, switch as you'll get the prize 2 out of 3 times.
But Bayes Theorem says it doesn't matter. P(C/~B)P(~B)=P(~B/C)P(C)
P(~B)=2/3. P(C) apriori = 1/3 before Monty opens B
P(C/~B)= probability C has the prize if B doesn't
P(~B/C)=1 If C has the prize, B doesn't for certain
Plug them all together:
(1/2)(2/3) = (1)P(C/~B)
1/3 = P(C/~B)
the probability hasn't changed
the frequentist statistics have a hidden assumption, that Monty deliberately selects a door without the prize
The Bayes Theorem assumes Monty selects a door at random