Every significant choice we make in life comes with some uncertainty.
All this is very good advice, but we should not get carried away. High-quality paper, bright colors, and rhyming or simple language will not be much help if your message is obviously nonsensical, or if it contradicts facts that your audience knows to be true. The psychologists who do these experiments do not believe that people are stupid or infinitely gullible.
The general theme of these findings is that the idea of money primes individualism: a reluctance to be involved with others, to depend on others, or to accept demands from others.
Everything makes sense in hindsight.
Bernoulli’s model lacks the idea of a reference point, expected utility theory does not represent the obvious fact that the outcome that is good for Anthony is bad for Betty. His model could explain Anthony’s risk aversion, but it cannot explain Betty’s risk-seeking preference for the gamble, a behavior that is often observed in entrepreneurs and in generals when all their options are bad.
You know you have made a theoretical advance when you can no longer reconstruct why you failed for so long to see the obvious. Still, it took us years to explore the implications of thinking about outcomes as gains and losses.
Merely reminding people of a time when they had power increases their apparent trust in their own intuition.
Jeremy Bentham opened his Introduction to the Principles of Morals and Legislation with the famous sentence “Nature has placed mankind under the governance of two sovereign masters, pain and pleasure. It is for them alone to point out what we ought to do, as well as to determine what we shall do.
There is one thing you can do when you have doubts about the quality of the evidence: let your judgments of probability stay close to the base rate. Don’t expect this exercise of discipline to be easy – it requires a significant effort of self-monitoring and self-control.
We are confident when the story we tell ourselves comes easily to mind, with no contradiction and no competing scenario. But ease and coherence do not guarantee that a belief held with confidence is true.
If you come upon an observation that does not seem to fit the model, you assume that there must be a perfectly good explanation that you are somehow missing. You give the theory the benefit of the doubt, trusting the community of experts who have accepted it.
Cognitive strain, whatever its source, mobilizes System 2, which is more likely to reject the intuitive answer suggested by System 1.
A basic rule of fairness, we found, is that the exploitation of market power to impose losses on others is unacceptable. The.
System 1 represents sets by averages, norms, and prototypes, not by sums. Each.
Expert intuition strikes us as magical, but it is not. Indeed, each of us performs feats of intuitive expertise many times each day.
If you can’t solve a problem, then there is an easier problem you can solve: find it.” P.
System 1 will detect that a person described as “a meek and tidy soul, with a need for order and structure, and a passion for detail” resembles a caricature librarian, but combining this intuition with knowledge about the small number of librarians is a task that only System 2 can perform – if System 2 knows how to do so, which is true of few people.
Jumping to conclusions is efficient if the conclusions are likely to be correct and the costs of an occasional mistake acceptable, and if the jump saves much time and effort. Jumping to conclusions is risky when the situation is unfamiliar, the stakes are high, and there is no time to collect more information. These are the circumstances in which intuitive errors are probable, which may be prevented by a deliberate intervention of System 2.
The explanation is a simple availability bias: both spouses remember their own individual efforts and contributions much more clearly than those of the other, and the difference in availability leads to a difference in judged frequency. The.
The reason you like the idea of gaining $100 and dislike the idea of losing $100 is not that these amounts change your wealth. You just like winning and dislike losing – and you almost certainly dislike losing more than you like winning.