Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

by Annie Duke

The distorted view we get when we look into the future from the present is similar to the stereotypical view of the world by Manhattan residents, poked fun at by the famous New Yorker cover. The cover was a drawing of a map from the perspective of a person from New York. In that view, half the map covers a few blocks of the city. While you can see all the buildings on Ninth Avenue and even vehicles and people, the Hudson River and New Jersey are just horizontal strips. The entire United States occupies the same amount of space as the distances between Ninth and Tenth avenues. Beyond a strip of the Pacific Ocean are three tiny lumps, labeled “China,” “Japan,” and “Russia.” When we forecast the future, we run the risk of a similar distortion. From where we stand, the present and the immediate future loom large. Anything beyond that loses focus. Imagining the future recruits the same brain pathways as remembering the past. And it turns out that remembering the future is a better way to plan for it. From the vantage point of the present, it’s hard to see past the next step. We end up over-planning for addressing problems we have right now. Implicit in that approach is the assumption that conditions will remain the same, facts won’t change, and the paradigm will remain stable. The world changes too fast to assume that approach is generally valid. Samuel Arbesman’s The Half-Life of Facts makes a book-length case for the hazards of assuming the future is going to be like the pres...