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Explore-Exploit

The explore-exploit trade-off is one of my favourite concepts. It simple, intuitive, and consequential and once you understand it you see it everywhere.

The explore-exploit trade-off occurs whenever you’re faced with a choice between unknown outcomes. Such choices are ubiquitous. What music should you listen to? What clothes should you buy? What route home should you take? What food should you eat? Where should you go on vacation? Should you move to a new city? Which major should you choose in university, and, for that matter, should you go to university? Who should you be friends with? Who should you date? Who should you get married to? Should you have children? Should you change careers? Should you get divorced?

Your answers depend on how adventurous you are; whether you choose the unknown or the familiar. The familiar has a reliable outcome you can exploit. There is no risk to ordering pizza from your favourite restaurant; you know you will enjoy it. The new has an unknown outcome that you can explore. The Thai restaurant you’ve never tried could be amazing or it could be a waste of money. You aren’t going to order from both restaurants so there is a trade-off between the known reward of good pizza and the unknown reward of Thai food. If you always choose the familiar pizza you will miss out on discovering that you love shrimp pad Thai and green curry. If you always choose the new restaurant you will encounter food you dislike more often. Most of us settle on some compromise between the two. We try new music sometimes but also listen to our favourites quite frequently.  We try new cuisines sometimes but not every day.

Your past experience making these trade-offs shapes your future decisions. After dating a few people, you learn what you find important in a partner. You develop preferences that you will later use to decide whether to get married. As a child you are exposed to different subjects in school. If you enjoy math in middle school you may be more inclined to later pursue a career in STEM. If making a risky career move worked out, then you might be more inclined to make risky career moves in the future. If moving to a new city went horribly, you might want to return to your home city and never move again.  As you age you develop strategies for making important decisions that are informed by earlier outcomes (explore early and exploit later). These strategies inform your values and shape your personality. They influence your politics. They determine whether you become a rule follower or a rule breaker. They dictate whether you bought NFTs in 2021. Companies and investors live and die by these choices and the strategies they adopt. Societies engage in explore-exploit trade-offs on a macro level and the outcomes shape their culture and economy.

No matter your prior experience, you will always be faced with decisions where the outcome is unknown and you need to take a leap of faith. Failing to explore can have an opportunity cost as bad or worse than a bad outcome that happens by chance. We do the best we can to make educated choices that align with our values. The rest is up to fate.

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What I’m Working On

I’m working on myself.

I’m trying to be kinder to myself.

In my wife’s words, I’m trying to “take care of future me.”

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My physical health.

Getting regular exercise.

Understanding my body.

Addressing my health issues: inflammatory bowel problems and chronic back pain.

Being proactive.

Having better posture.

Stretching. Yoga.

Eating a healthier diet. Nuts. Berries.

Trying to figure out how the hell to drink less coffee.

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My relationships.

Being more present when I am with her.

Spending less time on my phone.

Doing the small things around the house that make her life simpler.

Taking as much an equal role in caring for a newborn as a dad can.

Being romantic.

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My mental health.

Thinking more slowly.

Not dwelling on things I can’t control.

Like the news.

Or the climate.

Or other people.

Recognizing anxious thoughts.

Guarding time.

Saying no more often.

Being patient and grateful.

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Is it working?

Am I a better version of myself?

Am I happier?

Are they happier?

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Time will tell.