Human beings are biased. Whether they know it or not, human beings often make decisions based on the factors that have little to do with the decision itself. Dan Ariely’s Predictably Irrational: The Hidden Forces That Shape Our Decisions sets out to expose the various logical fallacies that so many (in fact, all) people make on a daily basis. Ariely has collected dozens of examples of these fallacies and presents them in a way that is both illuminating and entertaining. Being able to examine the decisions we make and the reasons we make them, hopefully, will lead us to become better decision-makers overall.
Predictably Irrational’s first chapter, “The Truth About Relativity,” discusses the way certain irrelevant factors affect an individual’s decision-making process. Ariely uses an example from Williams-Sonoma to illustrate his point. When the company introduced a bread machine, its sales were not very good. They added a “deluxe” version of the bread machine, which cost fifty percent more than the original, and suddenly, the first began selling much more. Even though the original machine was still the same price, when compared to the new, more expensive, model, people felt it was a more worthwhile purchase. The fact that this is only one of several examples listed in the chapter, shows how easily swayed people are when certain, seemingly important, but actually irrelevant, information is added to the process.
The chapters following cover many other biases and fallacies. Reasons why our decisions affected by social norms, supply and demand, and myriad other factors are addressed. Chapters eleven and twelve, however, are interesting as they cover what Ariely calls, “the context of our character.” Chapter eleven, “Why We Are Dishonest, and What We Can Do About It,” recounts several experiments that allowed for small acts of dishonesty. Most often, people cheated when they were presented with the opportunity to do so, but only to a small degree. Incidence of cheating was lessened when students were reminded of some moral benchmark prior to the experiment (e.g., the Ten Commandments or the recognition of an “honor code”). In neither case was there the possibility of being caught, so it follows that a person’s moral values (to whatever extent and in whatever capacity they play a role in each individual’s life) have a lot to do with how honest or dishonest he or she may be.
Chapter Twelve, “Why Dealing With Cash Makes Us More Honest,” is a discussion of the fact that people are much more likely to steal when the monetary value of the item is not directly at hand. One experiment Ariely conducted involved leaving a six-pack of sodas in a communal refrigerator—all of which disappeared after 72 hours. When Ariely left a plate containing six one-dollar bills sitting unattended, none of the money disappeared. Stealing a pen is much more likely than stealing ten cents to pay for the pen. Business professionals are much more likely to cheat on expense reports if an assistant is handing them in. Ariely believes that cheating is not necessarily limited by risk, but by an individual’s ability to justify the cheating.
Basically, each chapter of Predictably Irrational serves to illustrate a different way our own brains work against our ability to be logical in the decision-making process. It is important to note that in many cases, individuals involved in the experiments did not expect that they would make an illogical decision, but they very often did. Predictably Irrational is an important work, as it helps to expose the mistakes our brains make on a daily basis, and how these mistakes influence our ability to make good, sound decisions.
Ariely, Dan. Predictably irrational: the hidden forces that shape our decisions. New York, N.Y.: HarperCollins Publishers, 2008. Print.
1. Early in the book, Ariely recounts his own excruciating ordeal recovering from very severe burns. He discusses the way the nurses removed his bandages as being quick but terribly painful. This is similar to the idea of pulling a Band-Aid off quickly, in one motion. Ariely proved that this is not actually the least painful way to remove the bandages, but many of the nurses were reluctant to change their ways. Even when it comes to causing pain in others, we are often reluctant to change our processes.
2. Ariely includes a particularly striking visual example of relativity. The optical illusion, wherein one circle is placed in the center of a ring of circles, and a second circle is placed inside a ring of much larger circles is a great example of relativity because while both circles are the same size, the second appears much smaller when compared to the other circles.
3. Even when we are aware of these fallacies, can we ever really overcome them? For the previous example, even though I know both circles are the same size, it is very difficult to see this.
4. It is especially interesting to see how culture affects cognitive biases. Ariely’s example of how individuals in America are likely to seek out uniqueness and may alter their choices based on this, while individuals in Asian cultures are likely to seek out conformity, in turn altering their own choices, is telling.
5. Ariely’s experiment regarding arousal was particularly unsettling. People are much more likely to do inadvisable things during states of arousal.
6. In a section about self-control, Ariely suggests a credit card that would allow people to put limits and restrictions on when and how they spend. This is a highly practical suggestion. It seems odd that it isn’t already in place.
7. Chapter ten discusses how the placebo effect works in cases other than clinical trials. It applies to an experiment Ariely conducted with energy drinks and price. The more expensive a drink, the more energy the person drinking it felt they had. Is it actually the placebo effect in place in cases like this?
8. Ariely’s examples are clear and well-delineated, but what practical applications do they have if we are so unaware of them occurring at the moment?
9. Some of Ariely’s “experiments” read more like interesting anecdotes. For example, the fact that individuals are more likely to choose something free over something of better quality that costs more is not particularly illuminating.
10. Research like this is only useful if it has real-world applications, but Ariely doesn’t suggest too many.