Wednesday, October 27, 2010


A blog reader of mine, Information Technology Services Manager Dusko Galic, has recently brought my personal attention to some interesting insights from the book, 'Discover Your Inner Economist', by professor of economics Tyler Cowen.

The insights, as follows, pertain to three principles from the professor for distingusihing good economics from bad economics, so to speak.

1) The Post Card Test:

A good economic argument should be possible to be written on a moderately-sized post card.

2) The Grandma Test:

Most economic arguments ought to be intelligible to your grandma.

3) The Aha Principle:

If the basic concepts are presented well, economics should make sense.

I particularly like the first one, more from a non-economic application perspective.

If you have a great idea & you have thought it through thoroughly, then you should be able to express it within the confines of a post card in order to sell your idea.

It's like doing the 'Elevator Speech' to grab a potential investor's quick attention.

As for the Grandma Test, I have often used a slight variation to explain to my students in a training workshop about the acid test for understanding a complex subject matter.

If you can explain it to your grandma, & she can understand at least the rudimentary aspects of it, then, one can safely say you have truly understood your subject matter.

Thanks, Dusko, for sharing!

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