I like this idea from Morgan Housel on positioning and defining levels of confidence on a scale from a low to high position of authority on a topic. We’ve all seen plenty of instances of “levels 1 and 2” confidence out there:
Let’s call this Level One confidence. You’re confident in something because you don’t know enough to realize how little confidence you should have. It’s driven by gut feelings and the belief that intelligence in one field justifies your expertise in another. It’s a mess, and one few people think they fall for because beliefs exempt from the nuance of real expertise are rubber stamped in your head as unequivocally true.
A step above this, let’s call it Level Two confidence, is when you’re confident about a topic tangential to your field of expertise. Say you’re an expert at building cars. Then someone asks you whether Tesla is overvalued. Since you know a lot about building cars you feel qualified to have an opinion. But car manufacturing is one of thousands of variables that goes into valuing car companies – and the most important variable is “whatever mood the market is in,” which isn’t the kind of thing engineers steeped in precision appreciate. It takes little effort to assume your skill in one field makes you an expert in a cousin field. The danger is that first cousins can have little in common.
It’s a helpful framework for getting outside of your own head on a subject. I find that reservation about my own confidence on topics helps strengthen it in ones where confidence is warranted — I’m confident in my understanding because I’ve thought about it extensively. I try to stay skeptical of my own knowledge on almost all subjects, enough to be introspective about what I really know without becoming hamstrung by inaction.