Order effects
(reading time – 1 min.)

We tend to focus on first-order effects, not second- or third-order effects – If I wreck my car, I’m most likely to be upset about my wrecked car (first-order effect), not how I’m going to pick up my kids from school each day or how higher insurance premiums will affect my monthly budget (second-order effects), even though the second- and third-order effects will have a bigger impact on my life than the damaged car.

Much of the analysis on coronavirus stops at the first-order effects. “Stay healthy, wash your hands, you’re going to be fine.” But the second and third-order effects of this could potentially be quite large. Just one example: the US healthcare system is utterly broken. Roughly 60% of Americans can’t afford to pay for an unexpected emergency and 10% of Americans don’t have health insurance at all.

Topic: #CognitiveBiases
Source: markmanson.net