SESHADRI

Let's define a rational actor as a decision maker who always chooses the path with the highest expected happiness, or expected utility. In the case of betting, a rational actor will take a bet only if he expects it to leave him in a state of higher utility than refusing the bet. Utility can be expressed as a function of the state of the actor's life; in the real world, these factors may include personal net worth, satisfaction with family life, career, etc. Note that an actor can derive happiness from making others happy, so rational actors aren't always "selfish" in the conventional sense[2]... For simplicity, let's assume our rational actor derives strictly increasing happiness off of only his own bank balance, P with initial value P 0... Assume now that the actor was trying to bet some value b such that his expected bank balance is maximized. With some math, it follows that the actor's bank balance is maximized when he bets everything! Moreover, we would reach the same conclusion..