The proof that you truly understand a pattern of behavior is that you know how to reverse it.
The comparison of firms that have been more or less successful is to a significant extent a comparison between firms that have been more or less lucky.
I had stumbled onto a significant fact of the human condition: the feedback to which life exposes us is perverse. Because we tend to be nice to other people when they please us and nasty when they do not, we are statistically punished for being nice and rewarded for being nasty.
Psychology has come a long way.
Confusing experience with the memory of it is a compelling cognitive illusion – and it is the substitution that makes us believe a past experience can be ruined.
The danger is increasingly exaggerated as the media compete for attention-grabbing headlines. Scientists and others who try to dampen the increasing fear and revulsion attract little attention, most of it hostile: anyone who claims that the danger is overstated is suspected of association with a “heinous cover-up.
Rationality is logical coherence – reasonable or not.
One of the best-known studies of availability suggests that awareness of your own biases can contribute to peace in marriages, and probably in other joint projects.
Intuition is nothing more and nothing less than recognition.
Risk” does not exist “out there,” independent of our minds and culture, waiting to be measured. Human beings have invented the concept of “risk” to help them understand and cope with the dangers and uncertainties of life. Although these dangers are real, there is no such thing as “real risk” or “objective risk.
Grateful acknowledgment is made for permission to reprint the following images: Image on page 19 courtesy of Paul Ekman Group.
The halo effect adds the final touches, lending an aura of invincibility to the heroes of the story.
But the cadet was probably just lucky on that particular attempt and therefore likely to deteriorate regardless of whether or not he was praised. Similarly, the instructor would shout into a cadet’s earphones only when the cadet’s performance was unusually bad and therefore likely to improve regardless of what the instructor did. The instructor had attached a causal interpretation to the inevitable fluctuations of a random process.
Damasio and his colleagues have observed that people who do not display the appropriate emotions before they decide, sometimes because of brain damage, also have an impaired ability to make good decisions.
The general tendency to overestimate the probability of conjunctive events leads to unwarranted optimism in the evaluation of the likelihood that a plan will succeed or that a project will be completed on time.
System 1 generates an impression of similarity without intending to do so. The representativeness heuristic is involved when someone says “She will win the election; you can see she is a winner” or “He won’t go far as an academic; too many tattoos.
Now suppose that at the end of the page you get another instruction: count all the commas in the next page. This will be harder, because you will have to overcome the newly acquired tendency to focus attention on the letter f.
Peak-end rule: The global retrospective rating was well predicted by the average of the level of pain reported at the worst moment of the experience and at its end. Duration neglect: The duration of the procedure had no effect whatsoever on the ratings of total pain.
Resistance to stereotyping is a laudable moral position, but the simplistic idea that the resistance is costless is wrong. The costs are worth paying to achieve a better society, but denying that the costs exist, while satisfying to the soul and politically correct, is not scientifically defensible.
Hindsight is especially unkind to decision makers who act as agents for others – physicians, financial advisers, third-base coaches, CEOs, social workers, diplomats, politicians. We are prone to blame decision makers for good decisions that worked out badly and to give them too little credit for successful moves that appear obvious only after the fact. There is a clear outcome bias. When.