“Never, ever, think about something else when you should be thinking about the power of incentives.” — Charlie Munger The power of incentives is obvious. Even small children will modify their behavior in response to incentives set by their parents.
Social norms govern how individuals interact with each other and with society at large. Many norms have been incorporated into legal systems but most continue to be informal conventions. A significant percentage of the population will fail to adhere to
“Man, as a social animal who has the gift of language, is born to prattle and to pour out twaddle that does much damage when serious work is being attempted. Some people produce copious amounts of twaddle and others very
This mental tendency echoes the words of the song: “When I’m not near the girl I love, I love the girl I’m near.” Man’s imperfect, limited-capacity brain easily drifts into working with what’s easily available to it. — Charlie Munger,
There are many aspects of life where the link between cause and effect is very clear. Humans, as well as many other animals, quickly learn that taking a certain action invariably leads to a predictable and reliable result. For example,