An Argument Against First Principle Thinking
By: Michael Thomas
Tags: Startup

One the most celebrated traits of today’s most successful entrepreneurs is the ability to think differently than the vast majority of people. As my friend, Gijs — who is also participating in this daily story challenge — wrote, Elon Musk’s “secret sauce” is his ability to reason from first principles. But what does it mean to think for yourself? And why don’t more people do it?

Reasoning from first principles requires forgoing heuristic-based thinking in pursuit of more fundamental truths. A heuristic is defined as “any approach to problem solving that employs a method, not guaranteed to be optimal, perfect, or rational, but instead sufficient for reaching an immediate goal.” In other words it’s a mental shortcut.

In the 1980s most people assumed the market for computers was limited to businesses. Steve Jobs exploited this heuristic. More recently people assumed high-price luggage could only be sold in stores. Jen Rubio and Stephanie Korey exploited that heuristic when they founded Away and began selling luggage over the internet. Many of the most famous entrepreneurial stories are heuristic exploitation stories.

In our startup-obsessed society these stories have become mainstream folklore. Steve Jobs and Jen Rubio are fast becoming the new heroes in this shared mythology. Yet I don’t think that first principle thinking is anymore common today than it was 25 years ago. And that’s by design.

Generally speaking, evolutionary traits influence human behavior more than cultural norms. From an evolutionary perspective, questioning norms is inefficient. Which of these two humans do you think is more likely to survive? The one that questions the ethics of killing its prey or the one that hunts without second thought? It’s easy to forget that reason is a modern luxury.

Even from a more modern cultural perspective, first principle thinking has many disadvantages. Take ethics and law as one example. In a modern, specialized society it’s unreasonable to expect everyone to study ethical principles extensively. Instead legal systems codify ethical principles into a set of heuristics that everyone can follow. (This, of course, creates systemic injustice when the power is in the hands of one homogenous group).

One way of looking at our society is like a multi-armed bandit problem. For those unfamiliar with this idea, Josh Kauffman gives a great explanation in his blog post Explore / Exploit:

Imagine walking into a casino and deciding to play the slot machines. There’s a row of machines, each of which has a different probability of paying a reward when you pull the lever. Some machines pay more — some much more — than the other machines, but you’re not sure which machine has the highest return. If you knew the best machine in advance, you’d just pull that lever all day long, but you don’t have a clue, and no one is going to tell you. The only way to find out is to start pulling levers, pay close attention, keep track of what works and what doesn’t, and do the math. There’s a tradeoff to be made, however: when you choose to pull a lever you haven’t pulled before, you get new information about that option, and that information is valuable in finding the best overall machine. But pulling the less-tested lever has an opportunity cost: you’re not pulling the lever you currently think will give you the best return. There’s a risk that the lever you pull will return less than what you would’ve brought in pulling the current optimal lever, and that’s a very real cost. Information is valuable, but it comes at a price… The solution to the bandit problem is easy to understand: the optimal strategy is to start with a period of exploration, where you pull levers at random and gather information. When you have more information about what works and what doesn’t, you shift to spending the majority of your time pulling the best lever (exploitation), but you keep exploring the other options in case your current best option isn’t the very best that exists.

So here’s an idea: maybe society is a bandit problem where the goal is safety, wealth, and happiness. A small group of “misfits” like Musk, Jobs and Rubio explore new ways of progressing towards that goal and fail 9 times out of 10. But they gather new information and occasionally find new paths that the majority of people exploit (no negative connotation here). In this model, maybe we have just the right amount of explorers.