Poor Ash’s Almanack > Book Reviews > Effective Thinking
Per-Hour Learning Potential / Utility: ★★★★★★★ (7/7)
Readability: ★★★★★★★ (7/7)
Challenge Level: 2/5 (Easy) | ~300 pages ex-notes (328 official)
Blurb/Description: In a broad and thoughtful yet concise and engaging book, Peter Bevelin – learning heavily on Charlie Munger – provides a compelling overview and launching point for the mental modelsapproach.
Summary: This book covers a lot of mental models in rapid-fire format; it doesn’t go that deep into many of them, but it’s possibly the most learning-dense 300 pages you’ll encounter anywhere.
Highlights: The book makes good use of storytelling and salience, providing memorable examples – or quotes from Buffett/Munger – to complement the theory.
Lowlights: The book repeats itself in some places; it also doesn’t really do a good job of tying together interactions between models in the latticework.
Mental Model / ART Thinking Points: culture / status quo bias, trait adaptivity, cognition / intuition /habit / stress, multicausality, probabilistic thinking, mindfulness, agency, incentives, loss aversion,memory, local vs. global optimization, contrast bias, hyperbolic discounting, social connection, n-order impacts, luck vs. skill, marginal utility, structural problem solving, product vs. packaging,overconfidence, rationality, sunk costs, bayesian reasoning, salience, inversion, margin of safety,nonlinearity, bottlenecks, feedback
You should buy a copy of Seeking Wisdom if: you’re new to mental models – or if you want a compact review of a lot of the important concepts to refer back to from time to time.
Reading Tips: See the notes below, which index concepts to mental models in the PAA latticework, as well as other books that go deeper on concepts.
Reread Value: 4/5 (High)
First Read: 2014?
Last Read: 2017
Number of Times Read: 3
Planning to Read Again?: probably
Review Date: 2018
Notes Date: late 2015 or early 2016
NOTE: these notes are formatted differently from all other notes on the site. Treat these as an “index” – if you want to dive deeper into interesting topics covered in Seeking Wisdom, this will direct you to the best resource for further understanding any covered topic.
Page i: I would push back here on Twain’s quote about the character of the human race being permanent. See The Landscape of History by John Lewis Gaddis – LandH review + notes – as well as the culture / status quo bias and trait adaptivity mental models.
Pages 8 – 9: See probabilistic thinking as well as the aforementioned TVT. Also see culture, mindfulness, and agency.
Pages 16 – 17: Incentives and loss aversion. See Richard Thaler’s Misbehaving – M review + notes. On habit, see the aforementioned Deep Survival – DpSv review + notes – by Gonzales, or see The Power of Habit by Charles Duhigg – PoH review + notes.
Pages 18 – 19: The brain does not work like a computer, and memory especially does not – see Mistakes were Made (but not by me) by Tavris/Aronson – MwM review + notes. Buffett on inversionhere.
On trait adaptivity and the evolutionary-bio argument for traits, do see also Megan McArdle on hunter-gatherer vs. farmer morality in The Up Side of Down – UpD review + notes.
Page 23: Fairness is referenced here, as well as (sort of) local vs. global optimization. See Misbehaving by Richard Thaler – M review + notes.
Pages 24 – 25: On the adaptivity of amygdala hijacks. Again see Achor’s The Happiness Advantage– THA review + notes – as well as loss aversion and mindfulness.
Page 26: See causality and storytelling. Best read here is probably The Halo Effect by Phil Rosenzweig – Halo review + notes.
Pages 28 – 29: I don’t have a review on Fisher, but see Helen Fisher’s Anatomy of Love. Also see the marriage section in the hyperbolic discounting model.
Page 29: Social connection. See here The Lonely America – TLA review + notes – or Daring Greatly– DG review + notes.
Page 30: On fairness, n-order impacts, local vs. global optimization, social proof, and reciprocity bias. See Thaler (always see Thaler) as well as Nudge by Sunstein/Thaler – Ndge review + notes.
Page 31: On social connection as pain when removed – see Daring Greatly – DG review + notes.
Page 35: On trait adaptivity and cognitive “biases” being adaptive more often than not.
Page 36!: On rationality – see Poor Charlie’s Almanack – PCA review + notes – or The 7 Habits of Highly Effective People – 7H review + notes.
Page 43: Association bias. See The Halo Effect by Phil Rosenzweig – Halo review + notes.
Page 46: Luck vs. skill and process vs. outcome – see Halo or Michael Mauboussin’s The Success Equation – TSE review + notes.
Pages 47 – 48 marginal utility – see Thaler’s Misbehaving – M review + notes. Also see hedonic adaptation here and Shawn Achor’s The Happiness Advantage – THA review + notes. See also incentives.
Page 49: On structural problem solving, see of course Norman’s The Design of Everyday Things –DOET review + notes.
A little pushback here – Bevelin briefly says to reward performance and not effort – I would caveat with the aforementioned discussion of luck vs skill, also invoking hindsight bias as Thaler does in Misbehaving – M review + notes.
Page 50: On incentives – see Groopman’s How Doctors Think – HDT review + notes.
And on the psychologists wanting you to come back over and over again – see either Achor’s The Happiness Advantage – THA review + notes – or Dr. Judith Beck’s Cognitive Behavior Therapy – CBT review + notes. Cognitive behavioral therapy is intended to not make you come back over and over and over again.
Pages 53 – 54: loss aversion and incentives – also ideology here. See Tavris/Aronson’s Mistakes were Made (but not by me) – MwM review + notes.
Pages 55 – 57: Fundamental attribution error, man with a hammer, and commitment bias.
Page 58: Again on multidisciplinary rationality.
Pages 61 – 63: See sunk costs and commitment bias – parts (not all) of The Making of the Atomic Bomb – TMAB review + notes – and The Pleasure of Finding Things Out – PFTO review + notes – drive this home.
Page 64: Ideology as well as quasi Bayesian reasoning.
Pages 65 – 66: The First Rule of Holes. See also fairness and loss aversion.
Pages 67 – 69: In addition to the above, salience and scarcity bias.
Page 71: Love the sauerkraut story. See also status quo bias on default options and, of course,Nudge by Sunstein/Thaler – Ndge review + notes.
Page 72: Hyperbolic discounting.
Pages 73 – 75: Envy’s the only sin you can’t have any fun at. See also contrast bias (which includes anchoring). Misbehaving – M review + notes – is obviously the best read here.
And of course Thaler again, about identified lives.
Pages 78 – 79: Survivorship bias. See How Not To Be Wrong by Jordan Ellenberg – HNW review + notes – or The Halo Effect by Rosenzweig – Halo review + notes – or the story of poor Sanford Dvorin in The Frackers – Frk review + notes.
Page 80: Reciprocity bias.
Page 82: On attractiveness as a dumb metric, see hyperbolic discounting. Attractiveness has limited utility in the context of a long-term relationship.
Page 86: On bad decisions in groups, see Superforecasting by Philip Tetlock – SF review + notes. Tetlock cites the Bay of Pigs as well.
Pages 89 – 90: Authority bias. See Dr. Atul Gawande’s The Checklist Manifesto – TCM review + notes.
Pages 91 – 92: Counterfactuals. Also nostalgia ( hindsight bias.) See The Halo Effect by Rosenzweig – Halo review + notes.
Pages 94 – 95: Reason-respecting tendency and the associative nature of memory. See The Seven Sins of Memory by Schacter – 7SOM review + notes – or The Design of Everyday Things by Norman – DOET review + notes.
Page 99: Novelty-seeking and action bias. And ego.
Pages 103 – 104: See stress and agency. This shows up everywhere. Deep Survival by Gonzales –DpSv review + notes – and The Happiness Advantage by Achor – THA review + notes – probably the two best reads on stress. As far as agency, throw in The 7 Habits of Highly Effective People by Stephen Covey – 7H review + notes.
Page 105: obligatory addition here: being sleep deprived is the same as being legally drunk. Please see Why We Sleep by Dr. Matthew Walker – Sleep review + notes – and Internal Time by Till Roenneberg – IntTm review + notes.
Pages 112 – 113: Cognition vs. intuition and structural problem solving. Be careful with checklists. See The Checklist Manifesto by Gawande – TCM review + notes – and read carefully. Supplement with How Doctors Think by Groopman – HDT review + notes.
Pages 120 – 123: See n-order impacts.
Page 127: Complexity applies here. See also precision vs. accuracy and overconfidence.
Page 129: Scaling and nonlinearity. See Scale by Geoffrey West – Scale review + notes. He covers power laws (discussed on 133) well.
Pages 131 – 132: See critical thresholds.
Page 134: Bottlenecks. See The Goal – Goal review + notes.
Page 135: Causation. Also disaggregation.
Pages 137 – 138: Multicausality and correlation vs. causation. See How Doctors Think by Groopman – HDT review + notes – and The Signal and the Noise by Nate Silver – SigN review + notes.
Page 140: On the null hypothesis, see How Not To Be Wrong by Jordan Ellenberg – HNW review + notes. Also here see conditional probabilities.
Page 141: contextualization. Ioannidis study cited here; see notes to HNW above for discussion.
Page 142: See compounding. Best example I’ve found is the Hayflick WI-38 cells in The Vaccine Race – TVR review + notes.
Pages 144 – 145: On base rates and “50/50.” See Superforecasting by Tetlock – SF review + notes– on predictions under uncertainty.
Page 147: “Someone who’s gotten away with doing the wrong thing longer than you have.” See process vs. outcome, probabilistic thinking, and Deep Survival by Gonzales – DpSv review + notes. Also see schema bottlenecks and feedback; think about McArdle’s earlier-referenced commentary – doctors don’t see the patients they kill by not washing their hands (or sleeping). They never even notice.
Page 157: Marginal utility.
Page 158: Planning fallacy.
Page 161: On system failure, bottlenecks, path-dependency, and so on – see To Engineer is Humanby Henry Petroski – TEiH review + notes.
Pages 163 – 164: On errors. And margin of safety – see above. See also of course structural problem solving; The Design of Everyday Things by Don Norman – DOET review + notes – is the best read here. The Checklist Manifesto by Atul Gawande – TCM review + notes – is also good
Page 174: See above.
Page 176: Nonlinearity and out-of-sample stuff – see Nate Silver’s The Signal and the Noise – SigN review + notes – your previous (sober) driving record is irrelevant after twelve vodka tonics.
Pages 178 – 179: Survivorship bias. See Ellenberg, Rosenzweig.
Pages 184 – 185: On decision journaling. See Megan McArdle’s The Up Side of Down – UpD review + notes – or Philip Tetlock’s Superforecasting – SF review + notes.
Page 189: Multidisciplinary rationality.
Pages 190 – 191: All models are wrong; some models are useful. See above. See also The 7 Habits of Highly Effective People by Stephen Covey – 7H review + notes – and The Landscape of History by John Lewis Gaddis – LandH review + notes.
I would also point to emergence here – see Gaddis or Gonzales in Deep Survival – DpSv review + notes – on emergence, the sand pile effect, etc.
Page 194: On memory and habit.
Page 199: On utility.
Pages 203 – 206: On precision vs. accuracy.
Page 208: Nice example of inversion, among other things.
Page 209: Integrity matters.
Pages 212 – 213: Simplification and goal orientation.
Page 216: More on inversion; also disaggregation.
Page 217: On nonlinearity, among other things.
Page 219: See also Bayesian reasoning and Planner-doer.
Page 222: See Gawande’s The Checklist Manifesto – TCM review + notes.
Page 223: On the specificity of goals.
Page 225: Opportunity costs. See… guess who? Thaler!
Page 228: Back to n-order impacts.
Pages 238 – 239: scientific thinking
Pages 244 – 245: more inversion
Pages 249 – 251: margin of safety, path-dependency, and geometric series that multiply to zero…
Pages 253 – 255: also on luck vs skill (sort of) and integrity
Pages 256 – 257: on defensive pessimism (see margin of safety)