5 things I learnt from Thinking in Bets, a book by poker player Annie Duke
Introduction
A month ago, I wrote about the 6 reflections from Maria Konnikova’s book The Biggest Bluff. I mentioned Annie Duke’s Thinking in Bets as a related book I was reminded to read. I finished reading the book this week. Here are my takeaways.
Similarities & Differences
There are a fair bit of similarities between the two books. Both are about poker, by female authors who are Americans and have degrees in psychology. The authors have a common friend in Erik Seidel. In fact, I was curious why Maria Konnikova had not mentioned Annie Duke in her book, The Biggest Bluff. Or that Seidel had not mentioned Duke to Konnikova during her training.
The biggest difference is that Konnikova’s book is more about personal journey, while Duke’s is more about decision making. Unlike Konnikova, Duke did not write extensively about her hands or plays with other poker players. Rather, Duke cited different research in each chapter and drew lessons from episodes in realms outside poker. At the start of the book, for example, she elaborated on Pete Carroll’s call in the 2015 Super Bowl. Towards the middle, she also referenced the 2016 US Presidential elections and lamented the shift in the hiring criteria of clerks of supreme court judges.
Overall, as a non-poker player, find Duke’s book to be more accessible in drawing lessons to apply in life.
Use probabilistic thinking against resulting
The first of 5 things I learnt from Thinking in Bets is the use of probabilistic thinking to counter resulting.
In Chapter 1, Duke effectively gave a formula for life outcome with the following:
there are exactly two things that determine how our lives turn out: the quality of our decisions and luck
She warned against “resulting”. This is the tendency to equate the quality of a decision with the quality of its outcome.
Duke then put forward the notion that
A great decision is the result of a good process.
And such a process would invariably represent our own state of knowledge as some form of “I’m not sure”. She then proceeded to suggest the use of probabilistic thinking to determine our estimated outcome from a range of possible futures. At this point, I was expecting a reference to Tetlock’s Superforecasting. Interestingly, no such reference was made. While Duke mentioned Philip Tetlock later in the book, it was in the context of his research in confirmatory and exploratory thoughts.
Update your beliefs – Wanna Bet?
In Chapter 2, Duke cited Daniel Gilbert’s experiments that shows
our default is to believe that what we hear and read is true.
Duke suggested that people actually form abstract beliefs as follows:
- We hear something;
- We believe it to be true;
- Only sometimes, later, if we have the time or inclination, we vet
In poker, such belief formation process can be very costly, especially if such beliefs are faulty. She then cited another research in 1954 research by Albert Hastorf and Hadley Cantril on controversial 1951 football game between Princeton and Dartmouth. The point was:
pre-existing beliefs influence the way we experience the world
It is also at this point that Duke veered into the psychology of how fake news work:
“Fake news works because people who already hold beliefs consistent with the story generally won’t question the evidence….Fake news isn’t meant to change minds. As we know, beliefs are hard to change. The potency of fake news is that it entrenches beliefs its intended audience already has, and then amplifies them.”
Furthermore, the smarter a person is, the better he can rationalize and hold on to pre-existing beliefs, no matter how faulty they are.
To ensure we keep our beliefs updated and avoid unnecessary losses, Duke introduced a question that I would want to use more of. Of the 5 things I learnt from Thinking in Bets, I like this best: “Wanna bet?” Duke listed 14 questions we can ask ourselves to better vet what we read or hear. This will then turn around the order of our belief formation, so that we update our beliefs with facts.
Reshape habits to counter self-serving bias
The central idea of Chapter 3 is self-serving bias. It is a term used to describe a pattern of attributing to one’s skills any outcome that is good, and attributing to “bad luck” outcomes that are bad. John von-Neumann made an unexpected second appearance in the book here, when he was cited to have explained a traffic accident as follows:
“The trees on the right were passing me in orderly fashion at 60 MPH. Suddenly, one of them stepped out in my path. Boom!”
To counter such faulty thought process, the author recommends reshaping one’s habits. Charles Duhigg’s The Power of Habit makes an entry here. According to Duhigg, a habit has three parts: the cue, the routine, and the reward. To reshape a habit calls for maintaining the cue and reward, but swapping the routine. Duke suggests that, instead of focusing on the outcome-oriented instinct to seek credit and avoiding blame, we replace it with a routine of truthseeking:
Keep the reward of feeling like we are doing well compared to our peers, but change the features by which we compare ourselves: be a better credit-giver than your peers, more willing than others to admit mistakes, more willing to explore possible reasons for an outcome with an open mind,…
While I agree this sounds like the correct thing to do, it is the single one of the 5 things I learnt from Thinking in Bets that I remain skeptical about. I can’t help but think that bad people will drive out the good. Bad people are those adept at blame shifting. Like any skills, blame shifting improves with practice. I say this from personal experience in the companies I had worked with. At crunch time, to hold people accountable for bad outcomes, these most skilled at shifting blame typically survive. Then, because they are survivors, they end up running the company.
Find company: Buddy up
In Chapter 4, Duke recommends keeping ourselves on the straight and narrow by leveraging on peer pressure. She recommends having groups to ensure accuracy, accountability and diversity of views. To facilitate the working norms for such groups, she elaborated on Merton’s 4 norms for scientific community in Chapter 5.
On the necessity of diversity, the author cites John Stuart Mill, author of On Liberty. Mill’s view on diversity of opinion is:
“The only way in which a human being can make some approach to knowing the whole of a subject, is by hearing what can be said about it by persons of every variety of opinion, and studying all modes in which it can be looked at by every character of mind. No wise man ever acquired his wisdom in any mode but this; nor is it in the nature of human intellect to become wise in any other manner.”
I agree wholeheartedly with Mill’s views. I believe that as long as American and its leaders hold on to this view, the country need fear no challenges from any other nations which governments prescribe only one correct view.
The entirety of Chapter 5 was devoted to elaborating Robert K Merton’s 4 norms for scientific community:
- Communism: not the political kind, but the communal ownership of information within groups;
- Universalism: not favouring or prejudicing a message simply because of the receipient’s views about the messenger;
- Disinterestedness: not allowing conflicts of interest to sway our views. Duke recommended adopting outcome blindness as an approach to ensure this;
- Organized skepticism: the author mentioned a few ways different organizations have been practicing this. For example, ‘red team’ thinking in the CIA, Dissent Channel in the State Department. Key to this is to have an truthseeking charter agreed by all in the group.
Engage different versions of yourself
The last chapter of the book goes into how we can engage different versions of ourselves to do the right things. The author echoes the point about “future version of ourselves” she raised in Chapter 2. Essentially, this requires us to zoom way out, focusing on what the self in 10 years time would do, on looking back at the bet we face at the moment.
A few strategies Duke mentioned here are:
- Ulysses contracts: pre-commitment to either do something (barrier-reducing) or refrain from doing something (barrier-inducing);
- scenario planning: taking into account a range of possible futures and the likelihood that these might become reality;
- backcasting: imagining a positive future, and working out what needs to be done to get there;
- pre-mortem: imagining a negative future, and figuring out what might have gone wrong to get there.
A key-phrase that the author emphasized is self-compassion:
If we’re going to be self-critical, the focus should be on the lesson and how to calibrate future decisions
Conclusions
The 5 things I learnt from Thinking in Bets are as follows:
- Use probabilistic thinking against resulting
- Update your beliefs – Wanna Bet? If someone were to bet you on your beliefs, how firm would you hold?
- Reshape habits to counter self-serving bias: focus on learning what you might do to become a better version of yourself
- Find company: Buddy up
- Engage different versions of yourself
Post note
I felt ill last week because of food-poisoning. Apologies for the absence!
