
All Else Equal: Making Better Decisions
Ep18 “Investigating Implausible Theories” with John Ioannidis
Episode guests
Podcast summary created with Snipd AI
Quick takeaways
- Exploring implausible theories is valuable for business decisions, but evidence-based decision-making and active pursuit of challenging evidence are crucial to avoid erroneous beliefs.
- The erosion of trust in scientists and the scientific method highlights the need for humility, open-mindedness, and continuous improvement in scientific research and peer review processes.
Deep dives
The Importance of Investigating Implausible Theories in Business Decisions
In this episode, the hosts discuss the value of exploring implausible theories in the context of business decisions. While commonly believed theories tend to be true, there are historical examples where widely accepted ideas turned out to be false. The scientific method is highlighted as the best defense against erroneous beliefs, emphasizing the need for evidence-based decision-making. It is crucial to actively seek evidence that challenges one's own beliefs, even though people are generally resistant to changing their minds. Okem's Razor, often misunderstood as favoring the simplest theory, is redefined as favoring theories that are not overly complicated due to cluges or ad hoc adjustments. The significance of incentives in evaluating implausible theories is also explored, with Galileo Galilei's example demonstrating his lack of personal gain in proposing an implausible theory. Furthermore, the amount of money at stake and the implications of a theory should be considered, informing the decision to invest resources in its investigation.