Maxims for Thinking Analytically.

These are the maxims (general rules, principles) from the book “Maxims for Thinking Analytically” which presents the wisdom of legendary Harvard professor Richard Zeckhauser.

I really enjoyed this book, and I encourage you to read it.

Thinking Straight.

  • Maxim 1 — When you are having trouble getting your thinking straight, go to an extreme case.
  • Maxim 2 — When you are having trouble getting your thinking straight, go to a simple case.
  • Maxim 3 — Don’t take refuge in complexity.
  • Maxim 4 — When trying to understand a complex real-world situation, think of an everyday analogue.

Tackling Uncertainnty.

  • Maxim 5 — The world is much more uncertain than you think.
  • Maxim 6 — Think probabilistically about the world.
  • Maxim 7 — Uncertainty is the friend of the status quo.

Making Decisions.

  • Maxim 8 — Good decisions sometimes have poor outcomes.
  • Maxim 9 — Some good decisions have a high probability of a bad outcome.
  • Maxim 10 — Errors of commission should be weighted the same as errors of omission.
  • Maxim 11 — Don’t be limited by the options you have in front of you.
  • Maxim 12 — Information is only valuable if it can change your decision.

Understanding Policy.

  • Maxim 13 — Long division is the most important tool for policy analysis.
  • Maxim 14 — Elasticities are a powerful tool for understanding many important things in life.
  • Maxim 15 — Heterogeneity in the population explains many phenomena.
  • Maxim 16 — Capitalize on complementarities.

Living Fully.

  • Maxim 17 — Strive hard to avoid envy — see your friend’s success as your gain.
  • Maxim 18 — Do your best to banish regret.
  • Maxim 19 — Make pleasure-enhancing decisions long in advance, to increase the utility of anticipation.

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