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He argues that when you do something frequently, it gradually gets encoded in your brain until at some point your intuition, via your fast thinking, takes over most of the time and you can do the task mindlessly: driving on the highway, doing simple arithmetic, saying your name.
However, when you are in uncertain situations where you do not have encoded knowledge, you must use your slower thinking: driving on new roads, doing complex math, digging into your memory to recall someone you used to know. These are not mindless tasks.
slow. Following your intuition alone at times like these can cause you to fall prey to anchoring, availability bias, framing, and other pitfalls.
At the same time, intuition can help guide you to the right answer much more quickly. For example, the more you work with mental models, the more your intuition about which one to use in a given situation will be right, and the faster you will get to better decisions working with these models.
In other words, as we explained at the beginning of this chapter, using mental models over time is a slow and steady way to become more antifragile, making you better able to deal with new situations over time. Of course, the better the information you put into your brain, the better your intuition will be.
try consistently to argue from first principles. Another is to take every opportunity you can to figure out what is a...
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For example, consistent underperformers at work usually have a plausible excuse for each incident, but the real reason is something more fundamental, such as lack of skills, motivation, or effort.
As a metaphor, postmortem refers to any examination of a prior situation to understand what happened and how it could go better next time.
after every project so that the organization can collectively learn and become stronger (antifragile).
Sometimes you may want something to be true so badly that you fool yourself into thinking it is likely to be true. This feeling is known as optimistic probability bias, because you are too optimistic about the probability of success.
We started this chapter explaining that to be wrong less, you need to both work at getting better over time (antifragile) and make fewer avoidable mistakes in your thinking (unforced errors).
such as relying too much on recent information (availability bias), being too wed to your existing position (confirmation bias), and overstating the likelihood of your desired outcome (optimistic probability bias).
“You must not fool yourself—and you are the easiest...
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To avoid mental traps, you must think more objectively. Try arguing from first principles, getting to root causes, and seeking out the third story.
Realize that your intuitive interpretations of the world can often be wrong due to availability bias, fundamental attribution error, optimistic probability bias, and other related mental models that explain common errors in thinking. Use Ockham’s razor and Hanlon’s razor to begin investigating the simplest objective explanations. Then test your theories by de-risking your assumptions, avoiding premature optimization.
Attempt to think gray in an effort to consistently avoid ...
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Actively seek out other perspectives by including the Devil’s advocate position and bypassing the filter bubble. Consider the adage “You are what you eat.” You need to take in a variety of foods to be a healthy person. Likewise, taking in...
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Each additional spam message benefits the spammer who sends it while simultaneously degrading the entire email system.
They use the common resource for their own benefit at little or no cost (e.g., each course of treatment has only a small chance of increasing resistance). But as more and more people make the same decision, the common resource is collectively depleted, reducing the ability for everyone to benefit from it in the future
tyranny of small decisions, where a series of small, individually rational decisions ultimately leads to a system-wide negative consequence, or tyranny. It’s death by a thousand cuts.
At dinner, each person is faced with a decision to order an expensive meal or a cheaper one. When dining alone, people often order the cheaper meal. However, when they know that the cost of dinner is shared by the whole group, people tend to opt for the expensive meal. If everyone does this then everyone ends up paying more!
Professionally, it may be the occasional distractions and small procrastinations that, in aggregate, make your deadlines hard to reach.
The tyranny of small decisions can be avoided when someone who has a view over the whole system can veto or curb particular individual decisions when broad negative impacts can be foreseen. When the decisions are all your own, you could do this for yourself.
free rider problem,
you’ve ever worked on a team project where one person didn’t do anything substantive, that person was free-riding on the rest of the group.
Free-riding is commonplace with public goods, such as national militaries, broadcast television, even the air we breathe.
herd immunity
In this example, the public good is a disease-free environment due to herd immunity, and the free riders are those who take advantage of this public good by not getting vaccinated. The tyranny of small decisions can arise when enough individuals choose not to get vaccinated, resulting in an outbreak of the disease, creating a tragedy of the commons.
Unfortunately, some people cannot be medically immunized, such as infants, people with severe allergies, and those with suppressed immune systems. At no fault of their own, they face the potentially deadly consequences of the anti-vaccination movement, a literal tragedy of the commons.
If enough infractions are left unchecked, their incidence can start increasing quickly, creating a new negative norm that can be difficult to unwind.
People who don’t want to live with the effects of the degradation but also don’t want to do the hard work to clean it up may simply move out of the area or visit less, further degrading the space due to lack of a tax base to fund proper maintenance.
name from economics: externalities
consequences, good or bad, that affect an entity without its consent, imposed from an external source.
spillover effects,
The effects of smoking spill over to surrounding people through secondhand smoke and, more broadly, through increased public healthcare expenditures.
When you buy a car, you add congestion to the roads you drive on, a cost borne by everyone who drives on the same roads.
When you see or hear about someone or some organization taking an action, think about people not directly related to the action who might experience benefit or harm from
There are many ways to internalize negative externalities, including taxes, fines, regulation, and lawsuits.
Traffic congestion externalities are internalized through tolls.
Another way to internalize externalities is through a marketplace.
Well-defined property rights Rational actors Low transaction costs
The Coase theorem holds that instead of limiting the cows, another solution would have been to simply divide the grazing rights to the commons property among the farmers.
The way these systems work is that the government requires emitters to hold permits for the amount of pollutants they emit.
What spillover effects could occur, and who would be affected by them? Is there a common resource that free riders could abuse or that could degrade into a tragedy of the commons? Is there another way to set up the policy or system that would reduce possible negative effects?
people assess risk differently based on their individual positions and perspectives.
For example, will you drive more recklessly in a rental car after you purchase extra rental insurance, simply because you’re more protected financially from a crash? On average, people do.
moral hazard, is where you take on more risk, or hazard, once you have information that encourages you to believe you are more protected.
Moral hazards can also occur when a person or company serves as an agent for another person or company, making decisions on behalf of this entity, known as the principal.
For instance, when financial advisers manage your money, they try to stick to your risk profile, but they are more likely to take greater risks than you would on your own, simply because it isn’t their money, and so losses do not impact their net worth as much.

