Dishonesty is all about the small acts we can take and then think, ‘No, this not real cheating.’ So if you think that the main mechanism is rationalization, then what you come up with, and that’s what we find, is that we’re basically trying to balance feeling good about ourselves.
Marketing is all about providing information that will heighten someone’s anticipated and real pleasure.
Rainy day savings are incredibly important, because from time to time, bad things happen. And if you’re not prepared for that, it’s going to be really terrible.
In terms of the actual curriculum for management education, my own view is very simple-minded: The world is incredibly complex, it changes all the time, and we should not even hope that we could create a general model that accurately describes the world in all its possible states.
The retail industry has its own headache: it loses $16 billion a year to customers who buy clothes, wear them with the tags tucked in, and return these secondhand clothes for a full refund.
What kind of people would be able to rationalize better than other people? Better storytellers, right? Creative people, right? Because if you’re creative, you find more ways to cheat and still yourself a story about why this is okay.
What you should do is wait until the end of each month, and then say, “OK, how much money do I have? How much do I need? Let me send the rest to retirement.”
I always found the appeal to the market gods a bit odd. Why would the market fix mistakes instead of aggravating them?
It is true that from a behavioral economics perspective we are fallible, easily confused, not that smart, and often irrational. We are more like Homer Simpson than Superman. So from this perspective it is rather depressing. But at the same time there is also a silver lining. There are free lunches!
The problem with opportunity cost is that opportunity cost is divided among many, many things.
We need to believe that we’re good people, and we’ll do just about anything to maintain that perception.
Because cheating is easier when we can justify our behavior, people often cheat in small amounts: We can come up with an excuse for stealing Post-It notes, but it is much more difficult to come up with an excuse for taking $10,000 from petty cash.
With everything you do, in fact, you should train yourself to question your repeated behaviors.
It is very difficult to make really big, important, life-changing decisions because we are all susceptible to a formidable array of decision biases. There are more of them than we realize, and they come to visit us more often than we like to admit.
But suppose we are nothing more than the sum of our first, naive, random behaviors. What then?
That’s a lesson we can all learn: the more we have, the more we want. And the only cure is to break the cycle of relativity.
When people are in severe pain, there’s an expression, you’re a “pain person,” and what that means is that nothing else matters.
We have very strong intuitions about all kinds of things – our own ability, how the economy works, how we should pay school teachers. But unless we start testing those intuitions, we’re not going to do better.
The more cashless our society becomes, the more our moral compass slips.
When you’re in pain, tomorrow doesn’t exist – just the pain – and the only thing that you want in the world is for it to go away.