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The Cramér-Rao lower bound on variance: Adam and Eve's “uncertainty principle”

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Author Info
Michael R. Powers

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Abstract

Purpose – The editorial aims to describe the importance of the Cramér-Rao lower bound (CRLB) in matters of risk, and consider why this inequality generally receives less attention than it deserves. Design/methodology/approach – The CRLB is discussed in the context of other celebrated equations, one of which (Heisenberg's uncertainty principle) is actually implied by the CRLB. A hypothetical world with no randomness on the macroscopic level is then imagined, and the role of the CRLB in that world is considered. Findings – It is found that in a world with no macroscopic uncertainty, the CRLB would play a central role in describing the “counterintuitive” concept of randomness. Originality/value – The editorial identifies and explores an important epistemological result that is under-appreciated.

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Publisher Info
Article provided by Emerald Group Publishing in its journal Journal of Risk Finance.

Volume (Year): 7 (2006)
Issue (Month): 3 (May)
Pages: 233-236
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Handle: RePEc:eme:jrfpps:v:7:y:2006:i:3:p:233-236

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Related research
Keywords: Functional equations; Risk assessment; Variance;

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This page was last updated on 2009-12-13.


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