Second-order thinking

Second-order thinking (also called second-level thinking) involves deliberately looking beyond the immediate, obvious consequences (first-order effects) of a choice to anticipate the subsequent ripple effects, chain reactions, long-term implications, and unintended outcomes. It is a powerful mental model for superior decision-making that was popularized by investor Howard Marks in his book The Most Important Thing (2011). Seconder order thinking separates average thinkers from exceptional ones — especially in investing, strategy, leadership, and life decisions.

Second order thinking frequently discussed by investors Ray Daliom Shane Parrish (Farnam Street), and others.

See also

• Analytical thinking

• Rational thinking

External thinking

• Second-Order Thinking: What Smart People Use to Outperform
• Second-order thinking: Consider the long-term consequences of your decisions.
• Howard Marks' Second Level Thinking Skills
• Be Smarter: A Crash Course in Second-Order Thinking
• What is second-order thinking?
• Ripple Effect: How Second Order Thinking Shapes Our Lives
• How To Use Second-Order Thinking For a Creative Problem-Solving Process

Videos:

• Second order thinking - video playlist, Video playlist
• Second order thinking - video playlist, Video playlist