Beat the Mean: Better the Average

Abba M. Krieger, Moshe Pollak and Ester Samuel-Cahn

Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem

Abstract: We consider a sequential rule, where an item is chosen into the group, such as a university faculty member, only if his score is better than the average score of those already belonging to the group. We study four variables: The average score of the members of the group after k items have been selected, the time it takes (in terms of number of observed items) to assemble a group of k items, the average score of the group after n items have been observed, and the number of items kept after the first n items have been observed. We develop the relationships between these variables, and obtain their asymptotic behavior as k (respectively, n) tends to infinity. The assumption throughout is that the items are independent, identically distributed, with a continuous distribution. Though knowledge of this distribution is not needed to implement the selection rule, the asymptotic behavior does depend on the distribution. We study in some detail the Exponential, Pareto and Beta distributions. Generalizations of the "better than average" rule to the β better than average rules are also considered. These are rules where an item is admitted to the group only if its score is better than β times the present average of the group, where β > 0.

Keywords: Selection rules; Averages; Nonparametrics; Sequential observations; Asymptotics (search for similar items in EconPapers)
Pages: 24 pages
Date: 2007-11
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://ratio.huji.ac.il/sites/default/files/publications/dp469.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://ratio.huji.ac.il/sites/default/files/publications/dp469.pdf [302 Moved Temporarily]--> https://ratio.huji.ac.il/sites/default/files/publications/dp469.pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:huj:dispap:dp469

Access Statistics for this paper

More papers in Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem Contact information at EDIRC.
Bibliographic data for series maintained by Michael Simkin ().