mental-model - Concepts

Explore concepts tagged with "mental-model"

Total concepts: 34

Concepts

Asymmetric Information - When one party in a transaction has more or better information than the other, affecting decision quality and market function.
Asymmetric Upside - Decisions where potential gains significantly exceed potential losses, creating favorable risk-reward profiles.
Attention as Currency - Viewing attention as a limited resource that can be spent, invested, or wasted.
Bounded Rationality - The idea that decision-making is limited by cognitive constraints, available information, and time rather than being perfectly rational.
Butterfly Effect - Small changes in initial conditions can lead to vastly different outcomes in complex systems.
Chesterton's Fence - Don't remove something until you understand why it was put there in the first place.
Choice Architecture - The design of how choices are presented, which profoundly influences the decisions people make.
Circle of Competence - Know and stay within the boundaries of what you truly understand.
Cobra Effect - When a solution to a problem makes the problem worse through perverse incentives.
Counterfactual Thinking - Imagining alternative scenarios and 'what might have been' to learn from past decisions and improve future ones.
Decision Hygiene - Systematic practices for reducing noise and bias in judgment without targeting specific errors.
Dunbar's Number - The cognitive limit (~150) to the number of stable social relationships one can maintain.
Entropy - Systems naturally tend toward disorder; maintaining order requires constant energy input.
Expected Value - A probability-weighted average of all possible outcomes used to make rational decisions under uncertainty.
Fast and Frugal Heuristics - Simple decision rules that use minimal information yet often outperform complex analysis in uncertain environments.
Goodhart's Law - When a measure becomes a target, it ceases to be a good measure.
Hanlon's Razor - Never attribute to malice that which is adequately explained by stupidity.
Incentives - People respond to rewards and punishments; understanding incentive structures explains much of human behavior.
Leverage - Using small inputs to generate outsized outputs through the strategic application of force multipliers.
Map is Not the Territory - Models and representations of reality are not reality itself.
Margin of Safety - Building buffers to protect against uncertainty and errors.
Network Effects - A product or service becomes more valuable as more people use it.
Peter Principle - People in hierarchies tend to rise to their level of incompetence.
Probabilistic Thinking - Thinking in terms of likelihoods rather than certainties to make better decisions.
Prospect Theory - A behavioral economics framework showing that people value gains and losses asymmetrically, with losses hurting more than equivalent gains please.
Recognition-Primed Decision - A model of how experienced professionals make rapid decisions by matching situations to patterns from their experience.
Red Queen Effect - You must keep running (adapting and improving) just to maintain your relative position in a competitive environment.
Regression to the Mean - Extreme outcomes tend to be followed by more moderate ones.
Skin in the Game - Having personal stake in outcomes leads to better decision-making and ensures accountability.
Streisand Effect - Attempting to hide or suppress information often increases its spread.
Tragedy of the Commons - Individual rational self-interest can lead to collective ruin of shared resources.
Two-System Thinking - The mind operates through fast, intuitive System 1 and slow, deliberate System 2, each with distinct strengths and weaknesses.
Via Negativa - Improvement through subtraction and elimination rather than addition - what you don't do matters as much as what you do.
Wisdom of Crowds - Under the right conditions, collective judgments of groups are often more accurate than individual expert opinions.

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