Book: Thinking in Bets

I bought Thinking in Bets (Amazon) a while ago, April 2020 to be precise. It finally made it’s way out of my endless “to read” pile because I was having something of a crisis of confidence about my own decision making.

Some key thing that stood out.

Separating analysis of the result from the decision itself. The analogy throughout the book is poker, which is a combination of skill and luck. It’s an example of the key bias humans have – to associate winning with good skill, and losses to bad luck. Learning from decisions means separating out the luck and the skill, and focusing on improving skill without being as swayed by outcome. E.g. looking for mistakes made in a winning hand.

Assigning probabilities. Useful in communication of certainty, as well as a forcing function to really think though the confidence level. E.g. in a discussion saying, “I”m 60% on this, so I could easily go the other way”. Assigning probabilities in this way also encourages people to communicate them back to you, and then you can reconcile the difference.

The concept of “truth seeking”. Basically group interrogation of decisions, mistakes etc. In poker, talking through the hand in minute detail, and not even mentioning the outcome, and diving into mistakes. She also talks here about dissenting opinions on political lines, and how political polarization on the supreme court became worse as conservative judges stopped hiring liberal clerks. Having your thinking interrogated is part of forming balanced and well founded judgements. I hate the political example because it makes me think about debating human rights, but in other contexts I do agree and believe that you learn the most from people who disagree with you.

All in all I found it interesting, an easy enough read, and it definitely helped with the decision-making-confidence-crisis, so that was great.