The Right Decision: A Mathematician Reveals How the Secrets of Decision Theory Can Help You Make the Right Decision Every Time - Hardcover

Stein, James D.

 
9780071614191: The Right Decision: A Mathematician Reveals How the Secrets of Decision Theory Can Help You Make the Right Decision Every Time

Inhaltsangabe

CAN YOU EVER BE SURE YOU'RE MAKINGTHE RIGHT DECISION?

Should you stay in a comfy job with little chance of advancement-or take a riskier one in which you could make lots of money but also wind up on the street?

Should you listen to a doctor who advises surgery-or trust another who tells you to wait and see if your condition improves?

Should you remain in a cozy relationship without much spark-or cut your losses and search for your soul mate?

Is there ever a “right” decision? Professor James Stein would argue yes, and in this provocative new book, he shows you how to apply the mathematical principles of Decision Theory to every aspect of your life. Ingeniously blending statistics, probability, game theory, economics, and even philosophy, this dynamic new approach to decision making can help you choose a new career path, buy a better home, even pick the perfect mate. With The Right Decision, you can't go wrong.

INCLUDES ENTERTAINING INTERACTIVE QUIZZESTO HELP YOU MAKE THE RIGHT DECISION EVERY TIME!

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Über die Autorin bzw. den Autor

James Stein is a Yale graduate who received both his M.A. and Ph.D at U.C. Berkeley, is Professor of Mathematics at California State University, past member of the enormously prestigious Institute of Advanced Studies at Princeton (where Oppenheimer held the physics chair formerly held by Einstein and became the head of the Institute) and co-author of two other books. He is also the author of the soon-to-be-published book, How Math Explains the World (Harper-Collins 2008) which is scheduled for an initial print run of 50,000; translation rights have already been sold in a number of countries.

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the Right Decision

A Mathematician Reveals How the Secrets of Decision Theory Can Help You Make the Right Decision Every TimeBy JAMES STEIN

The McGraw-Hill Companies, Inc.

Copyright © 2010 James Stein
All right reserved.

ISBN: 978-0-07-161419-1

Contents


Chapter One

You Are What You Decide

Several years ago, Blink, a very entertaining and thought-provoking book, appeared on the market. In it, Malcolm Gladwell analyzes the snap decision—how we are capable of assessing information very quickly (in the blink of an eye, hence the title) and often reaching the correct conclusion.

Gladwell was honest enough to include instances of such decisions leading to erroneous conclusions as well. However, I suspect that a large part of the appeal of the book was inherent in the subtitle: The Power of Thinking Without Thinking. Thinking is hard work, and most people simply don't want to do it. I've taught mathematics for more than forty years, and I am still amazed at the number of students who are willing to put in hours every day improving their bodies but regard the process of spending an hour a day studying math as inhuman punishment.

You are most definitely what you decide. Some decisions are, understandably, "blink" decisions; if you go to the zoo and all of a sudden a tiger breaks loose from the enclosure, run like hell. If, one enchanted evening, you should see a stranger across a crowded room and the two of you make lingering eye contact, negotiate your way across that crowded room and introduce yourself. However, if you are confronted with a life-altering decision, such as whether or not to have surgery, don't "blink." This is probably a really good time for analysis—real mathematical analysis that will lead you to the best decision.

This book will give you the tools to make good decisions. Life can be viewed as a game, and the decisions you make determine to a large extent whether you will be a winner or a loser. Life's winners, more often than not, are the product of good decisions, and life's losers are frequently the result of bad decisions. The purpose of this book is to help you make more good decisions and fewer bad ones—no matter what the situation.

The Stages of a Decision

Suppose that, all of a sudden, you're hungry for Chinese, so you go over to your neighborhood Chinese restaurant, peruse the menu, and opt for the hot and sour soup and moo shu pork. You've just gone through the three major stages of a decision. Circumstances have arisen that necessitate the making of a decision (you're hungry for Chinese), you lay out a bunch of alternatives (read the menu), and choose among the alternatives (place your order). Admittedly, the decision you just made is closer to being a "blink" decision than a rational one, although you may have given some thought to the constraints imposed by calories, cost, and cholesterol. Nonetheless, the majority of decisions are similar to this one in that circumstances necessitate that a choice is made among alternatives.

In general, the events of your life conspire to require the making of a decision, so you can't do much about the first stage. When you're hungry for Chinese, you're hungry for Chinese. Depending upon the decision, you can exercise some influence over the alternatives and even propose creative ones. For instance, many Chinese restaurants have a page with entrées written in Chinese; you might take it upon yourself to ask your server exactly what these are (but beware of the sea cucumber). It is in the third stage, when you make your selection, that the rubber meets the road. This is where most of decision theory is concentrated.

To get a feel for the structure of the quizzes, here's your first opportunity to make a decision. It would be a good idea to make this one correctly, for at one time the future of Western civilization depended upon it, and the fact that the decision was successful is one of the reasons that you're reading this book in English rather than in German.

Second-in-Command

The U.S. government has just handed you, General Leslie Groves, the biggest blank check in history and with it a mission: to build the first atomic bomb. You're going to have to find a physicist to be your second-in-command because only physicists can build an atomic bomb (if it can be built at all), and a general is about as popular with physicists as a fox at a chicken convention. However, you've finally narrowed your choice to three possibilities, and you've even pinned nicknames on them:

A. Slim: a chain smoker who could charm the birds out of the trees. Everybody in the physics community loves him, but can you trust him? The FBI thinks he might have Communist affiliations.

B. Sarge: a monomaniacal anti-Nazi who could probably lead a platoon of raw recruits to take an enemy machine-gun nest. An émigré from Hungary, even those who dislike him admire him.

C. Doc: winner of a Nobel Prize, he may be the brightest of the lot. A brilliant theorist and technician, he has only recently arrived from Italy, and he's something of an unknown.

Nobody wants to think about the horrifying possibility that the Germans will get there first, so it is quite possible that Western civilization could be riding on your decision. Should you choose

A. Slim?

B. Sarge?

C. Doc?

SOLUTIONS: Second-in-Command

A. Slim. 5 points. Every decision has a goal, and often this goal can be quantified, that is, expressed in terms of numbers. Quantifying results is an important part of making good decisions; these quantified results are called payoffs, and many decisions come down to how to maximize favorable payoffs or minimize adverse ones. Your payoffs for this decision are measured in the number of top physicists you can motivate to work on the project. In order to get that done, they'll need to love both what they are doing and the man who makes them do it, and Slim is beloved in the physics community. Yes, you are a little worried about his purported Communist affiliations, but Communist countries are not the enemy in this conflict. Your money should be riding on Slim, who is much better known as J. Robert Oppenheimer.

B. Sarge. 3 points. A close runner-up. This guy obviously has leadership potential, and there are certainly situations in which the success of a mission may even be enhanced if some of the men on the line dislike the leader. Many military objectives have been captured by men who hate their sergeant so much that they just want to show up that SOB. If something happens to Oppenheimer, it might well be a good idea to go with Sarge, otherwise known as Edward Teller, later to be known as the father of the hydrogen bomb.

C. Doc. 0 points. This choice may well be counterproductive. Sometimes it is not a good idea to have the most talented individual be the administrative head, as you could be taking him away from doing what he does best. Because he is so brilliant, however, it is probably a good idea to make him the head of an important technical subproject. Doc, also known as Enrico Fermi, was actually placed in charge of developing a sustainable chain reaction, which he accomplished under the football stadium at the University of Chicago in December 1942.

WHAT ACTUALLY HAPPENED

In the fall of 1939, shortly after Adolf Hitler invaded Russia, a letter from Albert Einstein and Leo Szilard was delivered to President Franklin Roosevelt outlining the...

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