Named after physicist Enrico Fermi, renowned for his “back-of-the-envelope” calculations, Fermi estimation is a technique for making surprisingly good guesses about seemingly impossible-to-know quantities. It relies on breaking down a complex problem into smaller, more manageable pieces, then making reasonable estimates for each piece. Finally, you multiply those estimates to get a ballpark answer.
Steps to Fermi Estimation
- Break It Down: Take a question and divide it into rough component parts.
- Assume and Simplify: For each component make an approximate assumption. The assumptions do not have to be extremely accurate. Approximating the number of zero’s in an assumption is a good rule of thumb.
- Mini-Problems: Take some of the components and multiply them together to simplify the problem.
- Multiply and Simplify: Taking the components and groups that you have found, you can do more simple multiplication and arrive at a rough answer to the question.
Fermi Estimation allows you to assess plausibility.
- Spotting Red Flags: It helps identify claims that seem wildly out of proportion.
- Building Intuition: Regular practice hones your ability to assess the reasonableness of information.
- Problem-Solving: It helps you approach complex questions in a structured way.
- A Tool for Critical Thinking: It encourages you to break down complex problems and think creatively.
Fermi Estimations are about ballpark figures, not pinpoint accuracy. But they’re a valuable tool for Calling Bullshit on dubious claims and fostering a more critical approach to information.