5 Mental Models to Help You Think More Clearly, Rationally, and Effectively

Strategies to improve your judgement.

We all like to think that we can understand things clearly, come to sensible conclusions, and make rational decisions. But more often than not, we overestimate our own judgment. Reality is always more complicated than it seems. The decisions we face are often more intricate than they appear. And to make matters worse, our minds often fall for cognitive biases and logical fallacies that distort our thinking and derail our reasoning. Thinking is hard. But, luckily, a few simple concepts can make it much easier. So, in this article, I’ll share the most useful mental models to think clearly, rationally, and effectively.

1. System 1 and System 2

The total cost of a baseball bat and ball is $1.10. The cost of the bat is $1.00 more than the ball. How much does the ball cost? Intuitively, you’ll probably think that the answer to this equation is 10 cents, but that’s wrong. If you go back and apply a little more effort, you’ll realize that the right answer is 5 cents (and $1.05 for the bat). This little exercise beautifully illustrates the difference between fast and slow thinking — what psychologist Daniel Kahneman refers to as System 1 and System 2:

“System 1 operates automatically and quickly, with little or no effort and no sense of voluntary control. System 2 allocates attention to the effortful mental activities that demand it, including complex computations.”

System 1 is the first layer of thinking that our brains delegate problems to. System 2 only gets activated when System 1 doesn’t have an answer. That arrangement usually works well because System 1 is generally good at what it does.

But, as we’ve seen in the bat and ball problem, System 1 is prone to make mistakes. In fact, the sloppiness of System 1 is what creates systematic thinking errors like cognitive biases and logical fallacies.

But despite the flaws of System 1, you shouldn’t try to operate solely in System 2. According to Kahneman, that’s not possible nor desirable. Instead, you should try to use the right system at the right time.

Let System 1 handle your routine decisions. It’s okay that it gets it wrong occasionally because it saves valuable mental energy. But whenever you’re about to make an important decision, you should switch to System 2. That is, you should slow down and think deeply about it. If you use the right system at the right time, you’ll navigate your decisions skillfully and avoid stupid mistakes.

2. Bayesian Thinking

Imagine the following news headline: “Violent Crime Doubles.”

If you read that in your local newspaper, you’d probably assume that the risk of getting assaulted has increased dramatically. But is that really true? Let’s say the risk of getting assaulted in your town last year was 1 in 10,000. Since violent crime has doubled, that means the risk of assault is now 2 in 10,000. In other words, the risk of getting assaulted is no longer 0.01%, but 0.02%.

So, the headline shouldn’t make you too concerned. Sure, the probability of getting assaulted has increased. It has indeed doubled. But it’s still very unlikely to happen. And that’s difficult to discern unless you factor in prior information about the situation.

This example illustrates the big idea behind what statisticians call Bayes’ theorem; that we should continuously update our probability estimates as we come across new information.

Most of us don’t do that. Instead, we either dismiss new evidence or embrace it as though nothing else matters. Suppose you consider yourself a competent driver and get into a car accident. In that case, you’ll probably protect your belief (“It was the other guy’s fault”) or replace it altogether (“I guess I’m a terrible driver”).

By applying Bayesian thinking, you instead adjust your confidence in your belief. So, if you’ve been driving for ten years without any prior accidents, perhaps you can now be 90% sure that you’re a good driver. That means you don’t have to avoid driving, but you should be a little more cautious than you were before.

The takeaway here is that you shouldn’t blow new data out of proportion. Instead, you should use it to update your confidence in your existing beliefs. If you do, your reasoning more nuanced, accurate, and useful.

3. First Principles Thinking

When Elon Musk began his mission to send the first rocket to Mars, he learned that the cost of a rocket was enormous — as much as $65 million. But he didn’t let that stop him. Instead, he reasoned this way:

Okay, let’s look at the first principles. What is a rocket made of? Aerospace-grade aluminum alloys, plus some titanium, copper, and carbon fiber. And then I asked, what is the value of those materials on the commodity market? It turned out that the materials cost of a rocket was around 2 percent of the typical price.

Instead of getting a ready-made rocket, Musk decided to create his own company, buy the cheap raw materials, and build it himself. And within just a few years, his company SpaceX had cut the cost of launching a rocket by almost ten times while still making a profit.

First principles thinking means breaking down complicated problems into their basic elements and then reassembling them from the ground up. It’s a powerful way to come up with innovative solutions to difficult problems.

Let’s say, for example, that you’re struggling to find the time to work out. Your experience tells you that your busy schedule makes it near impossible to get to the gym. And that assumption gets you stuck.

If you instead apply principles thinking, you’ll realize that the fundamental principle is marginal gains. That is, all you have to do to increase your fitness is to work out at a level your body isn’t used to. And you can do that with a quick high-intensity interval training routine at home.

First principles thinking helps you let go of prior assumptions so you can find better solutions. So, whenever you face a complicated problem, try to break it down and reassemble it.

4. Occam’s Razor

Occam’s razor is a problem-solving principle which states that: “Among competing hypotheses, the one with the fewest assumptions should be selected.” Another way of putting it is that the simplest solution is probably correct.

By applying Occam’s razor, you “cut away” what’s excessively complex so you can focus on what works. This approach is used in a wide range of situations to improve judgment and make better decisions.

Albert Einstein is one of many great scientists who has applied Occam’s razor in their work. His version of the same principle was: “Everything should be made as simple as possible, but not simpler.”

As a mental model, Occam’s razor works best for making initial conclusions with limited information. To use it, you compare the complexity of different options and favor the simplest one.

Imagine, for example, that you come home one day and find that your living room window is open. This surprises you, as you’re usually very diligent in closing it. There are two possible explanations for this:

1.You had a lot on your mind when you left and forgot to close it. 2.Someone has broken into your home while you were away.

The first explanation only requires a little mindlessness on your part. The second explanation, however, implies that someone had to open your window from the outside, disarm your alarm, avoid detection by neighbors, clean up behind them, and leave just as quietly as they came. By comparison, the first explanation is the simplest and therefore the most likely to be correct.

Obviously, Occam’s razor isn’t perfect. There are exceptions to every rule, and you should never follow them blindly. But, in general, favoring the simple over the complex will improve your judgment and reach the right conclusions faster.

5. Hanlon’s Razor

When other people make our life difficult, we tend to assume that they do it on purpose.

• Your colleague didn’t tell you about an important meeting? He must be trying to make you look bad and beat you to the promotion.
• Your friends meet up without inviting you? They must be going behind your back because they don’t like you anymore.
• Your kids put finger paint all over your kitchen wall? They must be trying to drive you insane.

But in reality, these explanations aren’t very likely to be true. It’s much more probable that your colleague simply forgot to tell you, that your friends assumed you were busy, and that your kids have yet to learn the difference between a kitchen wall and a canvas.

And that’s why Hanlon’s razor is a handy mental model. This principle is best summarized: “Never attribute to malice that which can be adequately explained by neglect.”

Just like Occam’s razor, Hanlon’s razor helps you cut away what’s complicated and unlikely. Malice is a big assumption, but negligence is not. People rarely have genuinely bad intentions, but they make mistakes all the time.

So, whenever you feel mistreated, keep this principle in mind. It will make you less judgmental and more empathetic. You’ll be able to give other people the benefit of the doubt. And that will make for much better relationships and way less stress.

Of course, there are people out there who do have malicious intent, and that needs to be taken into account. But, as a rule of thumb, assuming neglect before malice will make you more accurate in your judgments — and a more pleasant fellow human.

Quick Summary To improve your judgment, use the following mental models:

• System 1 and System 2: Use fast thinking for routine decisions and slow thinking for important decisions.
• Bayesian Thinking: Continuously update the confidence in your beliefs as you come across new information.
• First Principles Thinking: If you face a difficult problem, break it down and reassemble it from the ground up.
• Occam’s Razor: When there are many possible explanations, assume that the simplest one is probably correct.
• Hanlon’s Razor: If someone mistreats you, assume that they probably did it out of neglect rather than malice.

This article was originally published by Patrik Edblad, medium.com.