Incomplete information and over-estimation
  • Much of what you need to know in life is hidden from you. You need to make decisions, but is still the victim of chance or uncertainty.
  • We tend to over-estimate the role of our own skills. The more people overestimate the importance of their own ability, the less flexible their decision making becomes.

319 STASHED

1 LIKE

How to think under pressure

bbc.com

To avoid the trap of overestimating our own skill, we need to start thinking probabilistically. That means estimating the odds and adapting your decision-making accordingly.

Even if the decision had a good outcome, we still need to objectively analyse the quality of the decision-making underneath.

295 STASHED

Tilting means realizing that your emotions are not separate from the logic of your decision making - for example, the despair that comes from bad luck, or the overconfidence that comes from a win.

You can learn to cope better by regularly checking in with yourself to see what you are feeling and how you react. Once you have identified those feelings, then try to analyse how they're influencing your judgment.

331 STASHED

A poor understanding of good or bad luck can derail the decision making of bankers, judges, and athletes. Being aware of probability will prevent you from reading too much into random events, or 'spotting' trends when there are none.

In the current pandemic, where governments design policies based on limited data, we could all do with a better understanding of uncertainty and how to think about it under pressure.

290 STASHED

Deepstash helps you become inspired, wiser and productive, through bite-sized ideas from the best articles, books and videos out there.

GET THE APP: