Friday, December 8, 2006

Diminishing Returns


Whitney has this policy where she does not work past the point where she is getting some serious diminishing returns to her time. In this graph, you can see diminishing returns to capital. Whitney's policy refers to her study time; therefore you can think of output as "stuff learned" or "questions answered." The capital axis becomes the time axis. You can see that there is a point in time beyond which there is not a very large increase in output per unit time put in.

She has shared this philosophy with me, and I like it. It makes sense. You can shift to another activity where you are not getting such steep diminishing returns to your marginal minute and hence increase your overall productivity. I just have a problem leaving something if I think that I should be finishing it. I think I would like to adopt her strategy...but I think that I need to make one modification:

The marginal unit of "output" might be very valuable, especially if it "completes" the puzzle of knowledge you are trying to synthesize in your head. Therefore I am, at times, willing to endure the diminishing returns in order to get the last part of output out of my efforts.

Perhaps next semester I will try to adopt this strategy and see how it works out for me. I could even give it a test run during the first part of the semester and hold on to it if it's awesome, while retaining the ability to go back to my old ways.

I came in here to write this because I realized that I was getting very low marginal returns on my econometrics studying. Final tomorrow. However, I think that I'm just writing this to unwind...then I'm going to bed. I'll get up in the morning and review before going to school. By the way, the wind chill (without bike-speed factored in) is supposed to be 31° on my way to school tomorrow. Sounds like fun.
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