A reasoning discipline popularized by Howard Marks that requires asking "and then what?" after every first-order conclusion. First-order thinking stops at the immediate effect of a decision; second-order thinking traces the cascade of consequences, reactions, and feedback loops that follow.
A first-order analyst sees that lowering prices increases volume; a second-order analyst asks how competitors will respond, what the new price implies about brand positioning, and whether the volume gain compounds or reverses. Most strategic mistakes are first-order analyses applied to second-order problems.