@oscredwin makes the point that this poll conflates testing the two questions “do most people spend more time deliberating over larger amounts of money than smaller amounts?” and “do people who ever allocate >$1M spend less time deliberating over $100k than those who don’t?”
https://twitter.com/s_r_constantin/status/1363595510368645124
It’s arguably rational to spend more time deliberating over more money, all else equal, and it’s also arguably rational for your research-time per dollar to decline as your hourly wage increases or as the amount of money you have to allocate increases.
What I’d really like to know is if my subjective impression is correct that as people gain in wealth/authority/seniority, they have a higher “activation energy” to go check object-level facts themselves. More than you’d expect just from their time being valuable.
Jeff Bezos is a famous counterexample, with his rule that people write up a brief document, share it, and read it, before every meeting.
But the fact that Bezos had to make a rule means that other Amazon managers *were* coming unprepared to meetings.
Pure intuition here, but I suspect that once you start to think “my time is valuable”, you typically stop doing whole categories of things, even when some instances of the category don’t take long. You just develop heuristics like “I don’t have time to read documents.”
It’s hard to distinguish “this person is making decisions fast or relying on social proof because that’s actually optimal for them” vs “this person is making decisions fast or relying on social proof because they’re lazy.”
You’d want some kind of evidence like “executives and investors who do more deliberation/fact-checking/due-diligence get better results.”
This is definitely true on the very low end. Individual stock market investors (eg day traders) have been shown to get worse returns than institutional investors, to have more bias, and to gather less information before investing.
But that just tells us “being an inexperienced hobbyist leads to worse investment returns than being a professional who works on investing full time and has access to expensive information resources.” It doesn’t tell us whether *among* professionals, more deliberation is better.
Perhaps more relevant is the evidence from the Good Judgment Project that superforecasters seek more information than non-superforecasters.
That’s evidence that the *best* predictions are made by “infovores.” But there isn’t real money involved, so maybe it doesn’t apply IRL.
That’s evidence that the *best* predictions are made by “infovores.” But there isn’t real money involved, so maybe it doesn’t apply IRL.
I’d really like data on the decision behavior of investors or CEOs, and how it correlates with ROI. Haven’t found any so far.
I *have* found some negative results: hedge fund manager performance doesn’t correlate much with education, which might be a proxy for “infovoreness”.
I *have* found some negative results: hedge fund manager performance doesn’t correlate much with education, which might be a proxy for “infovoreness”.
I know @robinhanson has pulled a lot of evidence that firms are reluctant to pay for information; Robin do you know of evidence that those firms which *do* pay for info perform better?
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