Berkshire Hathaway Annual Shareholder Meetings (since 1994) Bonus Episode-The Psychology of Human Misjudgement-Charlie Munger
17 snips
May 2, 2021 AI Snips
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Build A Personal Psychology System
- Charlie Munger developed a personal psychology system to spot patterned irrationality after noticing recurring misjudgments.
- He used reading and experience to create tools to improve his decision-making.
Design Incentives That Match Goals
- Recognize and harness incentive power because it shapes behavior far more than intentions.
- Design incentives (like pay-by-shift) to align desired outcomes with actor rewards.
Skinner And Man-With-A-Hammer
- Munger recounts B.F. Skinner's influence and later reputation problems due to over-applying his method.
- Skinner exemplified the 'man with a hammer' syndrome: one tool used as the answer to all problems.