Decision Making & Critical Thinking
Probability, evidence, tradeoffs, and mental models
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Expected Value
Expected value combines possible outcomes with their probabilities.
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Base Rates
Start with how often similar events occur before focusing on a story.
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Second-Order Effects
Actions create consequences beyond the immediate result.
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Reversible Decisions
Move faster when a decision is cheap to undo.
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Falsifiable Beliefs
A useful belief names evidence that could prove it wrong.
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Inversion
Avoiding known failure modes can be easier than designing perfection.
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Survivorship Bias
Studying only the cases that made it through hides the identical cases that did not.
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Correlation Is Not Cause
Two things moving together may share a cause, run in the opposite direction, or coincide.
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Small Samples Lie
Small samples produce extreme results by chance far more often than large ones.
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Good Enough Beats Optimal
Beyond a point, more analysis costs more than the improvement in the decision is worth.
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Framing Changes the Choice
The same options presented as gains or as losses produce systematically different decisions.
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Delay Has a Price
Postponing a decision is itself a decision, and it carries a cost that is rarely counted.