As an economist, Russ Roberts has been taught to approach decision-making by conducting an analysis, weighing tradeoffs, and then rationally budgeting resources to get the most bang for his buck. But as he explains in his new book, Wild Problems: A Guide to the Decisions That Define Us, he found this approach woefully inadequate for grappling with life’s biggest decisions — things like figuring out whether to get married or how to live a meaningful life.
Today on the show, Russ and I delve into why the pros and cons approach to decision-making is inadequate when facing what he calls “wild problems.” Russ explains that what makes life’s big decisions so difficult to deal with is the fact that we don’t know what they’ll be like before we make them, the decisions themselves will transform us into different people, and their effects can be permanent, making such decisions akin to choosing to become a vampire. From there we turn to strategies for dealing with the inherent uncertainty around wild problems, including looking beyond basic happiness, considering tradition, and trying things out by experience.
Resources Related to the Podcast
- Russ’ previous appearance on the show: Episode #91 — How Adam Smith Can Change Your Life
- Transformative Experience by L.A. Hall
- Nicomachean Ethics by Aristotle
- Chesterton’s Fence
- AoM Podcast #774: How to Make Life’s Big Decisions
- AoM Podcast #486: How to Get Better at Making Life-Changing Decisions
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Read the Transcript
Brett McKay: Brett McKay here, and welcome to another edition of The Art of Manliness podcast. As an economist, Russ Roberts has been taught to approach decision-making by conducting an analysis, weighing tradeoffs, and then rationally budgeting resources to get the most bang for his buck, but as he explains in his new book, Wild Problems: A Guide to the Decisions That Define Us, he found this approach woefully inadequate for grappling with life’s biggest decisions, things like figuring out whether to get married or how to live a meaningful life. Today on the show, Russ and I delve into why the pros and cons approach to decision-making is inefficient when facing what he calls “wild problems.” Russ explains that what makes life’s big decisions so difficult to deal with is the fact that we don’t know what they’ll be like before we make them, the decisions themselves will transform us into different people, and their effects can be permanent, making such decisions akin to choosing to become a vampire. From there, we turn to strategies for dealing with the inherent uncertainty around wild problems, including looking beyond basic happiness, considering tradition, and trying things out by experience. After this show’s over, check out our show notes at aom.is/wildproblems. Russ Roberts, welcome back to the show.
Russ Roberts: Great to be back.
Brett McKay: So we had you on several years ago to discuss your book, How Adam Smith Can Change Your Life. You are an economist, so you spend a lot of your time thinking about how people make decisions and how to make the best decisions. When economists typically think about decision-making, do they have an idea of what an optimal approach to decision-making is?
Russ Roberts: Sure, because we have assumed a way of “Our hard part is the problem,” when economists study decision-making, they assume that we as human beings know what we want and what we like, and then it’s just a question of making sure that we pick the things that we like the most given how much they cost. So something’s really expensive, we might not want as much of it if it’s less expensive, if we already have a bunch of it, we might not want more of it as much as if we started with very little of it, so the 12th ice cream cone isn’t as thrilling as the second or even the first, and that’s the economics way in general of thinking about decisions. We have a set of what economists call “preferences,” we care about… We have a strict amount of income, we can’t have everything we want, and then the question is, how do we spend our scarce income and our scarce time to get the most out of life? And that sounds pretty reasonable.
Brett McKay: Right, so it’s all about tradeoffs, I think we’ve all done that when you bought a vacuum cleaner or a car, you think, “Well, if I get the upgraded package on this car, well, it’s gonna cost me a little bit more money, but I think in the long-term, I’ll enjoy that more.” Or sometimes, you say, “Well, I’m not gonna get that upgrade pack ’cause I’ll save some money, I can use that money somewhere else.
Russ Roberts: Exactly.
Brett McKay: Well, so this can work for a lot of decisions when what you want and the cost benefits of something but you say there’s a species of decisions where this typical utilitarian economic approach to decision-making doesn’t work, and these are called “wild problems.” What are some examples of wild problems, and why doesn’t the typical economic decision-making process work for them?
Russ Roberts: In life, we’re constantly making decisions where we’re not really 100% sure how much we’re going to like the choice we make. If I’ve eaten mint chocolate chip ice cream 50 times, the 51st time, I’m pretty sure of what I’m getting myself into, if I’ve never been married, it’s a little bit hard, and so I call wild problems problems where analytical methods and rationality, the way we usually define it don’t help so much, where there’s very little data, we don’t have an algorithm or an easy way to make the best decision, and these are problems like whether to get married, who to marry, whether to have children, how many children to have, what kinda career you should choose, where you should live, and even questions that are a little more “they,” and how much time should I spend on friendship? Should I be more self-centered? Should I tell my friends I’m busy tonight so I can work on that report and do better in my career?
A lot of these decisions are very different in the economist’s decision of, what kind of ice cream to buy, or whether to take a vacation on the mountains versus the beach. We have a lot of information about both myself and the choice I’m gonna make, and how it’s gonna make me feel when I’m done. These other kinda choices, these what I call “wild problems,” I’m not sure how I feel about them. In fact, once I make the choice, I might be a very different person. I just had my first grandchild… No, I didn’t have my first grandchild, my first grandchild just arrived in the world, I was surprised at how I felt when I held her in my arms, I knew something about having children, but grandchildren I thought about differently until I had one, and then I realized it’s not quite the same as I expected. That’s certainly true in marriage, it’s true in children, it’s often true of a career choice or where you live. You think you have an idea of what’s going on.
Now, you’re always gonna be surprised, you can’t know exactly how things are gonna turn out, but it’s more than that, you’re gonna be a different person, so how you feel about the things that happen to you are also changing, so it’s not just, “Oh, wow, I didn’t expect that.” It’s how I feel about that is now different, and that I think is one of the challenges of making rational decisions and facing these kinda problems. We don’t exactly know what we’re getting into, and once we get into it, we’re different people, which raises the question of who we want to be. So I argue it’s the right way to think about these problems, a big part of it is once you realize you’re going to be different, you now start thinking about, “What kinda person do I wanna be? Do I wanna be a parent? Do I wanna be a spouse? Do I wanna be this kinda career, an economist or a lawyer? How is that going to… That identity, how is that going to make me feel?” And those are hard questions.
Brett McKay: Okay, there’s a lot to unpack here, and I hope we can hit on this, so wild problems, it sounds like wild problems are the really important decisions, that’s the importance to who to marry, if to get married, whether to have kids, where to live. It’s not buying a vacuum cleaner.
Russ Roberts: Yeah, and so that causes us a lot of anxiety ’cause it’s not a secret that they’re important, and one reason they’re important is they have lots of ramifications for how we’re gonna feel and live and what we’re gonna experience. Plus the other reason they’re important is they’re hard to reverse. You don’t like the vacuum cleaner, you can usually send it back, you can’t send back a romantic spouse or a partner, but it’s not the same kind of experience, and so there’s a lot more at stake that puts a lot more anxiety on us, and it puts a lot of pressure on us to make that decision well, and we start looking around like, “How do I… Oh, I need more data.” That’s a great thing to do when I’m trying to buy a product and I say, “I need to look at some reviews.” I don’t get reviews for my spouse. I had to look through reviews for what it’s like to have a kid given that I’m gonna feel differently once I have a kid, and not just that, most of the aspects of being a parent are not easily described in a paragraph review on, say, Amazon, so it’s a very different lift set of pressure and anxiety.
It’s strictly problematic in the modern era, where a lot of the decisions that people make, they didn’t use to be decisions. It wasn’t a decision to get married, everybody got married if they could, now it’s a choice. Having a kid, everybody would have kids if they could, now it’s like, “Should I bring a kid into the world? Am I gonna like being a parent?” So I think people today are in a very different set of experiences and choices than in past generations, and I think it’s a lot harder.
Brett McKay: So with wild problems, you can’t use the typical rational utility approach deciding but you highlight people who have tried to do that, tried to solve these wild problems using rubrics and checklists and things, and one of these guys was a famous guy, Darwin. Darwin was trying to figure out whether to get married, and the typical scientist he was, he decided to make a list. How’d that work out for Darwin?
Russ Roberts: Not so well. He was 29 years old and he thought, “Oh, yeah, maybe it’s time to settle down.” He made a list of the pros and the cons of getting married. The pros, the benefits of marriage were quite few and they weren’t very exciting. At one point he said, “It’s better than a dog anyway, to have a wife at home waiting for you,” or what he calls “female chit chat.” It’s not Darwin’s best moment, unfortunately, so he makes this list, the positives: Female company, somebody to talk to. They’re not very many of those, and then the cost, there’s a lot of them. “She might not wanna live in London, I might have to move out of London. She’s gonna have relatives I’m gonna have to spend time with, I’m not gonna be able to do my work, I’m gonna have to spend time with her, I’m gonna have kids at probably… And if we have kids, some of them could die. That’s gonna be really hard on me emotionally, I’m gonna be a wreck all the time.”
So he’s worried about the negatives and he makes the list, the negatives are very numerous, and the first thing I point out about that, that’s the first thing, the negatives outweigh the positives, so in theory, the rational choice is clear, “Don’t get married.” And yet Darwin decides to marry, and so I’m interested in this question, why did he make this leap into the dark even though his so-called rational approach said he shouldn’t? And I suggest that there are more things in life than the day-to-day pluses and minuses that he was able to imagine in advance before he married. There are some ethereal, higher-level aspects of purpose and meaning that he was aware of, he didn’t write them down. He didn’t write down anything about a shared life with another person, he didn’t write anything about love, he didn’t write anything about the benefits of making a sacrifice for another person. He just looked at the sacrifice, it’s all about him. And that’s reasonable before you get married because before you get married, you’re the only person you think about. Once you get married, essentially you have children, all of a sudden, there’s more to think about.
Somewhere in the back of his mind, he knew that, so it’s not like he made an irrational choice by marrying anyway, it’s that the things that naturally come to mind when you’re trying to make a rational choice in the face of these wild problems, they’re not necessarily the most important things. I use the metaphor of the person looking under the lamppost for the lost keys. A person can’t find their keys to their car and they’re looking under this lamppost late at night. Somebody comes along to help them, they’re looking too, and they can’t find them, and finally the helper says, “Did you lose them here?” “Yeah, I’m not sure but this is where the light’s the best.”
And I think that’s a very common seduction when we make decisions in the face of uncertainty, we look at the things that are in the light, the things that we can see, if you’re not married, what do you see with marriage and children? Well, a lot of… I describe them as “can’ts,” thing I can’t do once I’m married, things I can’t do once I have children. The real benefits are much harder to describe, much harder to imagine before you experience them, it’s a very different kind of calculus. So to think you have control of it mentally, “I’ll just make a pro-con list, a benefit-cost analysis, it’s just a little bit… ” You’re likely to mislead yourself, I’m not saying it can’t be done, it’s just difficult to do, and so what I’m trying to do in this book is remind people of what else is at stake besides the obvious day-to-day costs of our decisions and the day-to-day benefit.
Brett McKay: Yeah, I think that’s one of the biggest insights I took from this book that I really… I’ve been thinking a lot about, is when you have these wild problems, it’s hard to make the decision because you don’t know… You don’t realize how you’re gonna change when you make the decision. And use this analogy, someone talks about the decision to become a vampire. Well, you can’t make that decision because you’ve never been a vampire, so you don’t know what it’s like to be a vampire, and maybe you’ll like being there, maybe you won’t, so the only way you can find out is actually to do it.
Russ Roberts: Exactly, and that comes from a philosopher, L.A Paul, it’s her name, she wrote a book called Transformative Experiences, and it’s about having children, decisions like we’re talking about, and she uses a metaphor of a vampire, and it’s silly but it’s actually not that different in that you don’t know what it’s gonna be like, and once you’ve made the leap, you feel very differently than if you did beforehand. Although I do make the point, most of us would say, “Well, gee, being a vampire doesn’t seem like a very moral thing to do.” And using your ethics or principles or moralities, another way you can make some of these decisions in life when it’s not clear, but the best thing to do is for your happiness. In some sense, the book is… One of the themes of this book is that happiness is overrated and we’re naturally going to pursue the more obvious pleasures and we’re obviously gonna try to avoid the most obvious pains, subtler things, say, what it’s like to live a life as a parent or what it’s like to live a life as a husband or wife. Those are things you don’t have much access to and the people who do have access to them, people who are already married, the people who have children either can’t talk about it well or they don’t wanna talk about it. They’re uncomfortable.
So it’s natural if you’re thinking about being a vampire to ask vampires, say, “Hey, and what’s it like? You like it.” “Yeah, boy, it’s great. I’m out at night all the time and you live forever. Can’t beat it.” So that’s one way to get information, is to ask the people or to do a survey, but part of the problem with that is that it’s a very rich set of experiences that follow once you marry or have children or choose a particular career or live in a unusual or interesting place. Let’s say, you’re trying to decide where to live, it’s not just, “Oh, I like it.” It’s complicated, it’s nuanced, it’s multifaceted.
And so to boil it down to, “Yeah, it’s fun, I like it,” is I think missing a huge part of what makes life worth living. We care about a lot more than just, yeah, it’s pleasant. We care about meaning, we care about purpose, and these choices, these wild problems have a whole overarching aspect to them that suffuses our days, and doesn’t just say, “Oh, that was a good day,” or, “That was a bad day.” I make the point in the book that it very well could be the case that as a parent, there are more bad days than good days, so I don’t mean it’s irrational to be a parent. For me it hasn’t been, and I don’t know if it’s true, I didn’t count those days every day, so that was a good one, that was a bad one. I didn’t keep track, but there were a lot of tough days, and there still are.
Parenting is a very powerful experience, but my suggestion in the book, you don’t have kids because it’s fun, you don’t have kids because there are more good days than bad days, you have kids because it adds meaning to your life, you have kids because it’s a crucial part of being a human being, it’s part of the human experience, you have kids to understand your parents and your own relationship to the human enterprise, you don’t have them ’cause it’s fun and you don’t even just do it ’cause it’s more pleasure than pain, it’s not just adding up. Much more complicated than that. And I think economists and others should look at standard rational techniques are missing something when they try to apply them to these wild problems.
Brett McKay: Okay, so instead of focusing on the standard techniques to make a decision, you say a better rubric to help you make these decisions for wild problems is, figure out what it means to live a flourishing life, and this is borrowing from Aristotle and his Nicomachean Ethics. Have you figured out any ways to hone in on what it means to live a flourishing life? Like how do you know if like, “Okay, being married is part of my flourishing life.” How do you know that?
Russ Roberts: Yeah, and for other people, it might not be. I gave the example “why” in the book of Kafka. Kafka, the writer makes a pro-con list like Darwin and he decides not to marry, and for Kafka, being a great writer was an important part of flourishing and he was afraid, as was Darwin, that if he chose to marry, he might lose that key part of his sense of self and what he was gonna do with his life. In Kafka’s case, he decided not to marry, Darwin decided to marry, turned out okay for Darwin. Despite the fact that he married, had a bunch of kids, he did manage to produce some of the greatest scientific works in human history, so you could argue, “It could have been even better if he’d stayed single, he’d have been even more fulfilled.” But I suspect not. Marrying turned out much more pleasantly for Darwin, at least for most of his life than he’d expected based on his pro-con list.
But it does raise this question, so if you say that meaning and purpose are crucial to a full sense of wellbeing and not just fleeting day-to-day pleasure and pain, how do you think about that? And so I talk about a number of ways that I think that we flourish. Obviously these include things like using our skills to the utmost, they include knowledge of ourself. I can talk about different ways and I’ll spend a lot of time on this, but there are some obvious ways you can learn about who you are and what you want to be, you can go, you can have psychotherapy, you can have meditation, you can have religion, you can read literature and philosophy. All these things are ways that human beings have tried to understand their place in the cosmos and what is meaningful to them.
What gives their life purpose? There’s no easy answer for any one person, there’s no general set of principles that are simple but it’s an enterprise that you need to spend some time on. And one of the things I suggest in the book is that tradition is a tested way that people have found to be helpful. Some traditions are not helpful. That’s not simple, but you want to take all of these things seriously. A lot of what I’m talking about in the book is what Agnes Callard the philosopher calls “aspiration.” Who do I aspire to be? That’s something worth giving some thought to, right? What kinda person do I wanna be? Do I wanna be the kinda person who… Fill in the blank, or should I just take who I am now as good enough? And I would suggest that aspiring, the act of self improvement, the act of trying to become more than who we are today and something more tomorrow is a very powerful part of the human experience that does give people meaning.
Brett McKay: This reminds me. It sounds like Kierkegaard has this idea of, you go through these three phases of ethical development, and the first one is the aesthetic where you just pick, “Oh, this is fun, I enjoy this, I’m gonna wear these clothes ’cause they’re cool, I’m gonna read this novel ’cause it’s fun but he says at a certain point, you need to move on beyond the aesthetic to the ethical, where you start thinking, “What does it mean to live a good life?” And I think beyond that is the religious, where it’s beyond the ethical, but the way you figure out what that higher level is, like you said, I think reading philosophy, looking at religion, like these are issues that humanity has been thinking about for thousands of years. They might have some insights. They might not, things have changed obviously, but it’s a good place to start.
Russ Roberts: Yeah. It might not. What worked for someone else or worked for Kierkegaard might not work for you, or what works for your neighbor might not work for you. What worked for you when you were younger may not work for you when you are older. A lot of this is just being aware that this is an aspect of life to give some time and thought to, I’m not suggesting you have to go into a Buddhist meditation retreat for a year and think deeply about yourself and purpose in life, it’s more as you make these decisions in life, although that’s interesting, but as you make these decisions in life, you should be aware that they are determining who you are, not just what you enjoy or don’t enjoy, and that’s really the simplest way to think about what’s at stake. The subtitle of the book is A Guide to the Decisions that Define us. Now these decisions define who we are and what we make of our lives, who we can become, and that’s really important. Life is not just about racking up the most fun. Now, I’m not against fun, fun’s great, but in my experience, people who only pursue fun tend to get tired of it. They look for things that are more permanent, they wanna belong, they look for causes to devote themselves to, they look for a calling. These are the things that lead to the deepest satisfactions, and I think that’s the lesson to be learned from that.
Brett McKay: We’re gonna take a quick break for a word from our sponsors.
And now back to the show. You make this case in the book for following traditions. Oftentimes, us in the modern world think, “Well, traditions are fuddy-duddy, they hold you back, they’re just… ” But you say traditions can actually be really useful ’cause there’s already something in place, you don’t have to reinvent the wheel, it’s worked for a long time, it possibly will work for you as well.
Russ Roberts: And it’s a way to help answer that vampire problem. Most of the traditions that we have in this world suggest that being a vampire is really not the right thing to do. And so that’s one way to solve the problem of, “Well, so if I don’t know that I’m gonna like it or not what should I do? Maybe I’ll like it. It doesn’t look good now but all the vampires I know, once they become vampires, they seem to like it.” But maybe it’s just immoral and you shouldn’t do it, and tradition has come to this consensus that being a vampire is not the right thing to do, and similarly tradition has come to a consensus that having a child is a meaningful act. That may not be right for you, any one person, but it means take it seriously, I don’t suggest following tradition blindly, I think that’s a mistake. Well traditions can lead us astray, they’re not for you or me, they’re for other people but you should take them seriously. I ain’t gonna… I used the example in the book of the Chesterton fence.
Chesterton, GK Chesterton, a philosopher and writer, uses this metaphor of… You come across a fence in the middle of a field, looks like it has to have a purpose for which it’s fenced right in the middle of the field. Well, I tear it down, it can’t hurt anything, this doesn’t have any purpose. You should start by asking instead, “I don’t understand why this fence is here but rather than tear it down, I probably should look into it, I should probably find out why it’s here in the first place and not just assume it’s a mistake.” And I think often our egos and natural tendency is to see ourselves as the center of the universe as human beings. There’s a lot of value to saying, “I don’t understand everything. I’m gonna be humble, and I’m gonna receive wisdom and tradition and take it seriously. I might reject some of it, might accept some of it but I shouldn’t just dismiss it out of hand because I don’t understand.”
Brett McKay: Yeah, it’s a starting point.
Russ Roberts: Yeah.
Brett McKay: A lot of our wild problems involve other people. Relationships with other people, and you make this case that it might be useful to think of relationships in terms of covenants rather than contracts, and this is coming from your religious background, you are Jewish, and right now I’m reading the old Testament again, and there’s a lot of talk about covenants. Why the covenant approach to relationships? What’s the benefit there?
Russ Roberts:So let’s talk about the difference between a covenant and a contract, at least the way I’m thinking about it. Obviously there’s legal definitions sometimes. But a contract’s basically, “I’ll do this for you and you do that for me.” It’s a quid pro quo, “I’ll scratch your back, you scratch mine.” A contract lays out my responsibilities explicitly. It lays out your responsibilities, you’re gonna deliver this house, I’m gonna deliver some money by a certain date in a certain condition and so on. That’s a contract. Or I’m gonna work for you, I’m gonna do this task at this level of quality, using these raw materials, I’m gonna paint your house or build you a porch, and in return now you’re gonna give me money. But those are contracts. Covenants are about a commitment, and it’s a commitment that’s a little bit more open-ended than we think about. A contract has a commitment also but a covenant’s more, “This is unconditional, I’m gonna stand by your side.”
And I understand that not all covenants work out. Marriage doesn’t always work out, but a good marriage you don’t keep score. In a contract, you keep score. “Hey, wait a minute, you said you were gonna do this, this and this, and you didn’t come through.” Covenant is, “Oh well, I realize now that this partner of mine has certain challenges I didn’t appreciate, and maybe she can’t do this thing I expected.” Or vice versa, “I hope she’ll appreciate that I’m an imperfect person and I’m doing the best that I can, and I’m not gonna keep score and say, ‘Well, wait a minute. She drove carpool on Tuesday, so my turn on Wednesday and then, boy, she’d better come through on Thursday. Oh, she’s not feeling well? Wait a minute. We have an agreement. We take turns.'” In a covenant, you cut the person some slack and the commitment is much more open-ended and it’s much more long term and it’s really powerful. Covenant is, I’m not keeping score, I’m not gonna say…
In a contract, I might say, “This isn’t working out for me, I’m not getting what I expected, I have to walk away, I have to break the contract.” And there’s usually a clause in the contract for an end, but of course sometimes can end too. A marriage even based on a covenant can end, and just both parties can decide, or one, that it’s not working out, there’s too much that was not expected, it’s too painful. That’s totally understandable but what really covenant is saying is it’s gotta get a lot worse than it might otherwise be because I have a commitment to you, I am committed to our marriage, I’m not committed to me and my self-satisfaction, that’s a contract. A covenant is a commitment to us, it’s a very different human experience, and I think that good parenting is a covenant and a good marriage is a covenant and of course sometimes a work partnership can be more of a covenant than a contract even though there might be a contractual basis for it. It’s a very powerful idea. Certainly I wanna be around people who are committed to me and not just in it for work, as long as it’s positive versus negative.
So I think a lot of us say, “I wanna be that kinda person, I wanna be a person that you know you can lean on, you can trust, and I’m not keeping score.” And of course leaves me vulnerable, you can exploit me if I’m not keeping score. You can say, “Hey, I’m gonna try to get more outta this than I expected.” “It’s gonna be great, he’s gonna keep putting up with it.” And that’s why you wanna make a covenant with a person who has a similar level of commitment as you do, otherwise, you do leave yourself vulnerable in a covenant.
Brett McKay: So with Aristotle’s idea of flourishing his Nicomachean Ethics, it’s fluid, you’re making these situational judgments. Right? He’s trying to figure out like what the right thing to do at the right time for the right reason. And that can depend, that can vary depending on the circumstance. And I think that’s useful, I think I like to take that approach to decision making. But you make this case in the book that sometimes just having hard, firm life rules can be useful in living a flourishing life instead of trying to figure it out ad hoc. Why is that? Why are hard, firm life rules useful?
Russ Roberts: I used the example in the book of finding a lost wallet, you find a lost wallet, nobody sees you find it, it’s laying on the street. That actually happened to me once, you pick it up… I picked it up, it’s full of cash, and nobody saw, 90% never… 100% sure nobody stopped, but it looked to me that nobody saw it, put it in my pocket and kept walking, I did, once I got to a safer, little more secluded place, take it out of my pocket, saw what was in it, found some way to return it to the owner, which ended up being a great long adventure I do not tell in the book, and it’s not worth telling here, but it took a long while but eventually I got the wallet back to the owner, turned out to be a homeless person, though finding an address or a way to reach someone turned out to be harder than I expected.
But economists, if they’re not careful say, “Well, whether you return it or not depends on how much money is in it. ” I mean, if it has $20, sure, return it. What if it’s $50,000 in cash in a wallet? Is it rational to return it then? And I make it there up in the book that… Return it no matter what. Just have a hard rule, return it. One reason for that is that we’re imperfect and if we’re not careful, we’ll convince ourselves that it’s okay to keep it, and then that we’re not really following certain principles, we’re just finding an excuse for doing what we wanna do anyway. So in the case of principles, like honesty, trust, things like that, what I’m suggesting there is that you don’t wanna use the economic, normal way of trade-offs and saying, “Well, sure, it’s a good idea to return the wallet but if it’s so much money that it would change my life, then it’s rational to keep the money.”
I think that’s a very dangerous thing, you start to convince yourself of that when it’s $20, then you’re the kinda person who doesn’t return wallets, the person who is not trustworthy, and it will come back and bite you eventually in life, but as far… It’s just the wrong thing to do. But I wanna be the kinda person who does the right thing, I wanna live around people who do the right thing, I wanna hang around with people who do the right thing, it’s a more pleasant world. And I think I have a obligation to make my contribution to making the world more pleasant, so I’m not gonna be the person who exploits opportunities like that and keeps the wallet, keeps the money.
So I think what I say in there is, privilege or principles, “Do the right thing, and no matter how much it costs.” Now, God forbid, it means sacrificing a person that you care about, of course, that you… Then there’s two principles that conflict, your honesty versus… I used the example, supposedly, you need the money to save your child’s life for medicine. Of course, yes, that’s a little more complicated, but in general, that’s not what you’re up against, you’re up against your narrow self interest of, “What’s in it for me?” First, doing the right thing, I suggest do the right thing, you’ll be happier in the long run.
Brett McKay: Yeah, and it makes life easier too when you just… “I have this thing, I don’t do this thing,” or, “I do this thing.”
Russ Roberts: Correct.
Brett McKay: You don’t have to think about it. So you had a surprising source of insight on how to solve wild problems, I didn’t see this coming ’cause you were talking about Aristotle and Darwin and other philosophers. You got Bill Belichick, the head coach of the Patriots. What can Bill Belichick teaches about solving some of these wild problems?
Russ Roberts: So this insight of mine may not be true, let’s start with that, I’m not an expert on Bill Belichick, I didn’t interview him for the book, I wish I could have. He’s a very interesting decision maker. Obviously as the head coach of a football team, he’s constantly making trade-offs. He actually was an economics major as an undergraduate at Wesleyan, and I think he’s very aware of trade-offs. He’s not emotional, tries not to be an emotional decision maker, and when he cuts a player and people say, “How could you do? How could… Whoa!” He’ll say, “I tried to do what’s best for the team. That’s my job, period.” Doesn’t say anything else, it’s a constant refrain of his… He picks somebody in a draft choice, a very high draft choice, meaning a very valuable draft choice and it doesn’t work out, he can go off and cut him, “It’s not working out, instead of saying, “Oh, I gotta… That’ll be embarrassing, or, “I gotta justify it, or, “I gotta talk myself into why he’s gonna turn out okay.” I’ve got some… But that’s not the point that I focus on in the chapter.
Russ Roberts: What I focus on the chapter is the part that’s speculative about my part about his behavior. He often will trade a draft choice for multiple draft choices in worse rounds, so he’ll have a first or second round-choice and he’ll trade that choice for two picks in the fourth or fifth round, say. And why does he do that? And I think the reason he does this… This is a speculative part. I think the reason he does that is that he recognizes that the NFL draft, the choice of college players who you have pretty good information about but not perfect information, is a bit of a crapshoot, meaning it’s really hard to know how it’s gonna turn out.
So he’s gonna… He wants to have more choices than fewer. He wants to have lots of draft picks, even though some of them on paper are not as good as the fewer that he could have had if he had not made the trades, but he recognizes his own ignorance, and he tries to increase the size of the denominator, the number of options he has. Knowing that if they don’t turn out well, he doesn’t have to keep them on the team. And I suggest that this is the in-between case where it’s not as irrevocable when you make a decision, you should be… It’s okay to jump and make decisions where it’s not so expensive to change your mind when you discover more about the choice, should not be so afraid of it. Make more decisions, keep the good ones and cut your losses by getting rid of the bad ones because you don’t know. And what Belichick does is he uses training camp to get the information that he really needs. The information he has is how fast the person runs a 40-yard dash. How many yards per carry they gained in their particular college career, say, if they’re a running back, and so on. That information’s not the real information he wants.
The real information he wants is, “How is this person going to fit in with my players that I have right now on my team, and how’s this person gonna fit in with me? Are they gonna be comfortable with my style of coaching?” And he can’t discover that ex anti before the fact, he’s gotta go through some experience, you have to find out about how they’re gonna fit in or not fit in. And so he uses that as a way to figure out what to keep and what not to keep. And I think that’s a great lesson for life. Sample lots of things, do more of the things you love, do fewer of the things that you don’t love but gain some experience and self knowledge about what floats your boat, what gives you deep and enduring satisfaction. You can’t know that in advance. And so the Belichick lesson is, try to find out about yourself and about how you feel about things if you could do it in a way that isn’t too expensive.
Brett McKay: I think this is really useful advice for young people who are trying to figure out their career. So for example, I went to law school and I had no… I didn’t know any lawyers, I was the first lawyer in my family. My only knowledge of law was watching Law and Order and Matlock, and then I get to law school and I get my first internship, and I realize, “This is not like TV. This is not what I thought it was going to be.” And I didn’t enjoy it and I decided, “Law is not for me.” I finished law school but I decided not to pursue a career in law. And so now when I tell… When people ask me, like young people like, “Should I go to law school?” And I say, “You should just work at a law firm as an intern before you go to law school to figure out, do you actually like the practice of law?” And so yeah, I mean, like test it out. There’s ways you can test things out that aren’t expensive, so you don’t have to take out a bunch of student loans for law school. Test it out first, and you might learn you don’t like it.
Russ Roberts: Yeah, it’s great advice, and of course that’s why we date when we’re trying to decide who to marry but I think there’s a much deeper point here that you’re making, which I love, which is the information you do have, Matlock, Law and Order, is wildly misleading. [chuckle] You think you have valuable information about what it’s like to be a lawyer, you actually know almost nothing. Worse than that, the part that you do know from those shows romanticizes and exaggerates the positives and shows you almost nothing of the day-to-day unpleasant boring part, or worse, ethically challenging part of being a lawyer that you find you don’t like at all. And so it’s a great example and I think it’s particularly relevant for marriage and parenting. If you get your ideas of marriage from movies, you’re gonna be pretty disillusioned by real marriage. [chuckle]
It’s not that different than law school, real marriage is really different than TV marriage, or movie marriage. Right? The falling in love, the music playing, it’s lovely. Real marriage is much more complicated than that. It’s really interesting to me how little of the flavor of real marriage we share with our children. They do see us… See, we watch our parents, our children see us as parents, as married perhaps, and they get some idea, but we don’t talk to them much. In fact, literature, the reading of great novels is a much better way to understand marriage, when you’re reading a great writer, than say, a two-hour movie. And so literature’s a good thing, it teaches a little bit more about life often than a two-hour overly optimistic movie.
Brett McKay: Okay, so we’ve covered a lot of ground here, so I think it would be useful to do a quick recap here of our conversation, so while problems are hard because you don’t know how you’re gonna feel about them and you’re gonna be a different person once you make a decision around a wild problem, and it sounds like making the decision to do something like have a kid, it’s a wild problem, it’s akin to imagining a color you’ve never seen before, but we’ve talked about some things that you can do to make these decisions. One is, think about what will lead to a flourishing life and what will give you meaning, think in terms of covenants, consider tradition, create clear rules, and then when you can test these things out through experience, but as I was thinking, even with these strategies, you’re still gonna have to deal with the uncertainty. We can’t resolve all the uncertainty, so do you have any insight into how to learn just to be okay with the uncertainty when you’re trying to figure out these wild problems?
Russ Roberts: Well, I don’t spend much time in the book ’cause I don’t have any magic answers, it’s really tempting to say, “So just don’t worry about it, it’s easy, stop stressing over it. Stop. Not a good idea, better to be relaxed. It’s like when you’re late to the airport and you’ve never missed a plane and the traffic’s picking up and you say, “Well, I’ve never really missed an airplane, so I won’t let this traffic bother me.” It would be irrational for me to be nervous about it and that doesn’t work for me. I know maybe it works for somebody.
Brett McKay: No, it doesn’t work for me either.
Russ Roberts: So I don’t think that’s the right… I don’t think that’s helpful advice, I do think it’s useful to realize that the normal approaches you take to these kinda problems don’t help, so for many of these kinda problems, the normal thing to do, as I said earlier, was to go and get more data. Where is that app? I have trouble deciding what book to read next, I just go to Amazon, look at their recommendations, usually are pretty good. I need one of those for dating. Dating apps don’t work very well. I need one of those for how to parent. Good luck with that. They don’t work well. So I think recognizing that this is not an easy thing is a start toward reducing the stress and anxiety. Recognize that you’re not alone, that almost everyone deals with this. But it’s taken me… I’m 67 years old, it’s taken me a long time to get better, not good, but better at making decisions. I’m not talking about even wild problems, just day-to-day decisions. I’m the president of a college in Jerusalem, Schlemm college, I used to be a plain old researcher, economist, academic writer.
The biggest decision I used to make was, “Should I start this essay on medium or should I write it on Evernote or maybe Pages?” That’s not a very wild problem, not much is at stake. When you start making bigger decisions, you start to realize that it’s not that hard, not that bad, that the worst thing that can happen isn’t as bad as you think. So one piece of advice is to make more decisions, you do get better at ’em, you do get more comfortable with the fact that some work out and some don’t, and nobody bats 1000, it’s okay, it’s totally all right.
Brett McKay: Well, Russ, this has been a great conversation. Is there someplace people can go to learn more about the book and your work?
Russ Roberts: Sure. My website is russroberts.info, where I keep everything I do, videos, essays, books. You can follow me on Twitter @econtalker. The book is called Wild Problems, you can find it at Amazon and elsewhere, and it’s great talking to you.
Brett McKay: Thanks Russ, it’s been great talking to you too.
Russ Roberts: You bet. Thanks so much.
Brett McKay: My guest today was Russ Roberts. He’s the author of the book Wild Problems. It’s available on amazon.com and bookstores everywhere, you can find more information about his work at his website, russroberts.info. Also check at our show notes at aom.is/wildproblems, where you can find links to resources. We delve deeper into this topic.
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