It seems to me that most of the disagreements aren't actually about how to calculate probabilities given a scenario, but rather on which scenario we're in. In the hope of disambiguating it, I'll consider a
generalised envelope problem. Instead of the amounts being X and 2X, we'll generalise to U and V which are assumed to be positive real valued.
This makes the problem, per Jeramiah's OP:
You are playing a game for money. There are two envelopes on a table.
You know that one contains $U and the other $V, [but you do not
know which envelope is which or what the numbers U or V are]. Initially you
are allowed to pick one of the envelopes, to open it, and see that it
contains $Y . You then have a choice: walk away with the $Y or return
the envelope to the table and walk away with whatever is in the other
envelope. What should you do?
The first interpretation consists in:
(1) Being given an envelope.
(2) Opening it doesn't do anything to the sample space, conditioning is irrelevant.
First interpretationIf you switch from U, you get V. If you switch from V, you get U.
These are the only two possible scenarios for switching.
What's the gain, then? In the first case, the gain is 0.5(V-U), in the second case the gain is 0.5(U-V). The sum is 0. There's no expected profit from switching.
So what if you substitute in V=2U?
0.5(U-2U)+0.5(2U-U)=0
Still 0.
Now what about not switching.
If you don't switch from U, you get U. If you don't switch from V, you get V.
In the first case, the from not switching is U-V, in the second case, the gain from not switching is V-U.
Each has equal probability of 0.5.
So the expected gain from not switching is 0.5(U-V)+0.5(V-U), which is 0.
It doesn't matter if you switch or don't switch so long as the amounts are independently generated and fixed. The space of outcomes is gaining U-V or gaining V-U with equal probability, they cancel.
Now for when the card is revealed and the sample space is... to be determined, as it's more complex. This is dealing with the original problem as stated by Jeramiah:
You are playing a game for money. There are two envelopes on a table.
You know that one contains $X and the other $2X, [but you do not
know which envelope is which or what the number X is]. Initially you
are allowed to pick one of the envelopes, to open it, and see that it
contains $Y . You then have a choice: walk away with the $Y or return
the envelope to the table and walk away with whatever is in the other
envelope. What should you do?
The confusions go away when you actually realise there are two possible sample spaces given that you receive X, and there is no information on which you're in.
The second interpretation consists in:
(1) Opening the envelope to receive X.
(2) There is no information over whether you're in the case (X,X/2) or (X,2X).
Second interpretation
You actually have 2 more complicated cases. The first case is when you have X and the amount in the other envelope is X/2, the second case is when you have X and the amount in the other envelope is 2X.
Consider the first case. The envelopes now contain X and X/2. If you have X and switch you gain -X/2, if you have X/2 and switch you gain X/2, which are equally probable, so they cancel in the expectation giving 0.
The second case. The envelopes now contain X and 2X. If you have X and switch you gain X, if you have 2X and switch you lose X, these are equally probable, so they cancel out in the expectation giving 0.
Now we have to decide what the probability is of being in the (X,X/2) case given that you observed X in the first one, VS the probability of being in the (X,2X) case given that you observed X in the first one. Assuming they're both equally likely, the resultant expectation is the average of the previous two... which is still 0. This is why
's and
@andrewk's comments about no information on which case you're in are important.
What if you now
know which of the two cases (X,X/2) or (X,2X) you're in? Well, that's pretty simple, if you know the case and you opened the envelope everything is deterministic from then on. If you have X, this tells you nothing about which of those composite states you're in, and if it did the problem collapses entirely given that you know X.
You end up with expectation 0 from switching and not switching so long as you're attending to the sample space consistently, independent of the interpretation.
Why is this different from the Monty Hall problem? When you're asked 'whether you would like to switch', the probability distribution changes to a distribution yielding 0.5 probability to each door, giving 2/3 probability of winning by Bayes' theorem. In the second interpretation, being told you receive X gives you no information about the resultant gain. Monty Hall does.
's enduring confusion throughout the thread consists in sneaking in some assumption that, in the second interpretation, the subject knows which case they're in. If instead the subject does not, the sample space
is not (X/2,2X), it's (X/2,X,2X) if you receive a random envelope (which you need three of for this to make sense). This doesn't resemble anything like the original problem in which there are 2 envelopes.
TLDR: you're never actually getting to the sample space (X/2,2X) from what you're given. If you actually do end up in that case, then the result's an obvious (even deterministic) choice given that you know X. If you interpret everything carefully, there's no preference for switching because there's never any information on which case you're in.
Edit2: Also, this is pretty much the analysis in Jeramiah's linked paper, though it's analysed in terms of conditional expectations rather than probabilities.