. When we train people merely to recall facts and replicate existing procedures we insulate their minds from experiencing the uncertainty inherent to novel problems.
The standardized educational process generates minds with a strong aversion to uncertainty, unwilling to accept the temporary and contingent nature of all human ‘knowledge’. Such minds are easy to influence, keen to embrace rules and regulations that offer them ready answers to neatly packaged problems.
But this illusion of certainty comes at the cost of imagination and creativity, and stifles the vitality of both the ‘educated’ individual and the wider society in which he participates.
I would like to expand on the problem of authority and its relationship to uncertainty in future articles. For now we’ll direct our attention to the problem generated by rewarding students for giving answers which correspond with an existing model.
When a person is trained within a Binary Payoff framework he tends to overvalue ‘being correct’ in the Fluid Domains of life outside the classroom.
For isolated decisions where payoffs can take extreme positive and/or negative values Binary Thinking is catastrophic. The Binary thinker inhibits his ability to experience unusually high returns whilst simultaneously exposing himself to excessive downside risk. For iterated decisions the Binary thinker suffers from poor performance despite (or rather because of) his tendency to be consistently accurate. We explore this problem further in the example below.
The Power of Probabilistic Thinking
To illustrate how conventional education trains people to make poor decisions in Fluid Domains, I present a simple poker scenario:
Consider a one-street poker game where our opponent makes a pot-sized bet with a range composed of either the nuts or a pure bluff (perfectly polarized). We may choose either to call his bet and go to showdown, or fold and surrender the pot to our opponent.
We face this same decision 10 times and our opponent constructs his range with a mix of 60% value hands and 40% bluffs.
If we use the Binary Payoff model so dear to an educational system that emphasizes how bad it is to be wrong then we will fold every time. Our result? We get ‘the correct answer’ 6/10 times and make $0.
The professional poker player incorporates pay-offs into his model and so calls every time, not flinching at being ‘wrong’ more often than not. His result? By thinking probabilistically he gets ‘the correct answer’ only 4/10 times and yet profits 6*-1+4*+2 = $2.
Our lesson is this: The Correct Answer is NOT always the Best Response.
COLLEGE CONSTRUCT: Get the right answer to as many questions as you can. Payoffs are binary.
POKER PERSPECTIVE: The best response depends on the associated payoffs; there are worse things in life than being wrong.
Players who fold too much in these situations (nits) do so because their Binary Payoff worldview renders them overly attached to being ‘right’. This worldview leads to a miscalibrated, loss-averse mentality because the emotional payoff associated with being ‘wrong’ is excessive.
In those Fluid Domains where there are very large potential payoffs, both positive and negative, a bias towards getting ‘the correct answer’ means that the Binary individual makes bad decisions consistently and with increasing frustration due to his poor returns.
Since the Domains essential to life are almost all Fluid this Binary Payoff bias cripples a man everywhere outside of his academic or corporate cocoon. This bias is so pervasive that it deserves its own name; I call it “The Meta-stupidity of Geeks”.
The Meta-stupidity of Geeks
In his classic personal development book, ‘The Magic of Thinking Big’, David Schwartz relates an anecdote about Henry Ford, Founder of the Ford Motor Company:
“One time Henry Ford was involved in a libel suit with the Chicago Tribune. The Tribune had called Ford an ignoramus, and Ford said, in effect, ‘Prove it’.
The Tribune asked him scores of simple questions such as ‘Who was Benedict Arnold?’ ‘When was the Revolutionary War fought?” and others, most of which Ford, who had little formal education, could not answer.
Finally he became quite exasperated and said, ‘I don’t know the answers to those questions, but I could find a man in five minutes who does.'”
In an era where we almost always have access to Google, Ford’s perspective becomes even more relevant: those who use their mind as a garage for facts will find success in artificial ‘examination’ environments but little in the real world.
We all knew fellow students in school with an encyclopaedic knowledge of trivia who were apparently incapable of getting to grips (for want of a better term) with members of the opposite sex.
Over the course of any given day, these students would have been faced with perhaps 100 questions on some academic matter or other and perhaps 1-2 interactions with a potential mate. Day-in, day-out they would score perhaps 95% on their academics and a big, fat zero in their sexual life.
Under the Binary Payoff model they were doing very well- still scoring over 90% on aggregate each day- yet a few years down the line they would regret not focusing their attention on the weightier questions of life. Eventually their complacency catches up with them.
The Meta-stupidity of Geeks is this:
They are consistently right about everything that doesn’t matter.
QUESTION(S) OF THE WEEK: Where in your own life has using a Binary Payoff model in a Fluid Domain held you back? If you are comfortable sharing I would love to hear your stories in the comments below. On a lighter note, what opportunities has playing online poker given you that you would have missed out on if you had stayed in college?
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