Applied Economics: Thinking Beyond Stage One by economist Thomas Sowell[0] explores this in good detail, applying it to political and economic policies, in his book. Housing policies, medicare and today's problem of defund the police can be better analysed if the framework of second-order thinking is used to view the pros and cons of such policies and their subsequent ramifications. Second-order thinking is a great m…
After subtracting the cost of the book, and time wasted times minimal wage, I highly suspect the average wealth generated by reading it is negative.
Second-Order Thinking
161–170 of 266 posts
Re: Second-Order Thinking
#162Earlier quoted context omitted.
I am not particularily familiar with the connotation of the term second-order-thinking , but to me it implies the somewhat mathematical meaning of it. The first order might be some value (e.g. a voltage) and the second order might be the rate with which that voltage changes and the third the rate with which this rate changes etc. To me this implies that thinking on a higher order is somewhat about stepping back and v…
I think it roughly amounts to “thinking through the implications of the implications”.
Why does this remind me of Abbot and Costello?
Re: Second-Order Thinking
#163Earlier quoted context omitted.
Indeed. Unfortunately the article lost me when I saw the graph of "extent to which you consider second order and subsequent consequences" vs "odds of success".
Aren't totally meaningless graphs the best though? ;) You're just bitter because you're already fourth order thinking... you assessed the whole thing as a dumbass waste of time. Also, never show people graphs when /ok, never mind
Re: Second-Order Thinking
#164Re: Second-Order Thinking
#165This is just an advert for some guy's book, isn't it?
After a short intro, the first sentence is: "In his exceptional book, The Most Important Thing, Howard Marks explains the concept of second-order thinking, which he calls second-level thinking." The book is linked to Amazon and it looks like it is an Amazon Affiliate link.
If you're a value investor and haven't yet encountered it, it is a great and accessible read. I've given a number of copies to friends.
Re: Second-Order Thinking
#166Earlier quoted context omitted.
how is that not long term thinking?
It is long term thinking. But long term thinking is not necessarily 2nd order thinking. It's basically good long term thinking, where you don't just come up with a plan that addresses a problem, but you also enumerate all the secondary effects, and the effects of those effects, etc. Any good long term thinking would do that, but it's not always clear if people really have thought it through. If someone says ban ICE v…
This comment in it's blind ignorance is a godsent gift to people of a leftwing political bias...
Re: Second-Order Thinking
#167Re: Second-Order Thinking
#168This article, and some of the comments here, seem to confuse "second-order" with "long-term". Long-term just means doing the same analysis far out into the future: "If I spend less on maintaining software product $LEGACY, I will save money. If I continue to do this, I will save more and more money by each passing month." Second-order means discovering neighbouring causal links. "If I spend less on maintaining softwar…
I often get stuck simulating too many different branches in possible futures and casual links to the point of slowing down my present capabilities.
My GF calls it overthinking, and not in a good way.
Perhaps I just need a bigger brain with more processing power.
Re: Second-Order Thinking
#169Many people have seen these squiggly little diagrams of subatomic physical processes, such as for example x-ray radiation scattering off of an electron. Each individual diagram has an order, related to the number of nodes in the diagram.
In one domain of physics, quantum electrodynamics, each higher order contributes a smaller incremental amount of accuracy to the calculation. Roughly, one might imagine first order gives 90% accuracy, second order gives 99% accuracy, third order givers 99.9% accuracy, etc. In this world, you don't expect the second-order processes to blow up in your face. (technically, this is due to small coupling constants)
However, in other domains (quantum chromodynamics, which describes processes inside the proton, neutron, quarks and gluons etc.), the second-order processes can be just as, if not more, influential than first-order processes. Now you have a problem if you ignore second-order processes, as the first order calculation might only give you 10% accuracy, the second gives 20% accuracy and so on.
When second (or third) order processes are not insignificant, that's where they can return to bite you in the seat if you ignore them, aka 'blowback'. The difficulty then lies in determining whether or not such second order processes have this potential effect in the system of question.
Re: Second-Order Thinking
#170Are there any studies for this conjecture?