Irrationally yours

1. Irrationality shapes our decisions more than we realize

"The impact of our collective irrational decisions on our lives is very very large."

We are predictably irrational. Our decisions are influenced by cognitive biases and emotional factors that we often fail to recognize. These irrational tendencies affect various aspects of our lives, from personal relationships to financial decisions.

• Common irrational behaviors:
  • Overvaluing what we already own (endowment effect)
  • Sticking with the status quo even when better options exist
  • Making decisions based on relative comparisons rather than absolute value

Understanding these biases can help us make better decisions and design more effective policies and interventions to improve human behavior.

2. Social norms and expectations heavily influence our behavior

"Social norms are a powerful motivator and we are all susceptible to their influence in many areas of our lives."

We are social creatures. Our actions are often guided by what we perceive as socially acceptable or expected behavior, even when it contradicts our personal preferences or rational self-interest.

• Examples of social norm influence:
  • Tipping in restaurants
  • Dressing appropriately for different occasions
  • Following unwritten rules in public spaces

Recognizing the power of social norms can help us understand and potentially change behaviors at both individual and societal levels. By shaping social expectations, we can encourage more positive behaviors and outcomes.

3. Our environment plays a crucial role in shaping our choices

"That's where our free will resides—in our ability to design our environments in a way that is more compatible with our strengths and, even more important, helps us overcome our weaknesses."

Design for success. The physical and social environments we inhabit have a profound impact on our decisions and actions. By intentionally structuring our surroundings, we can make it easier to make good choices and harder to make bad ones.

• Ways to optimize your environment:
  • Remove temptations (e.g., keep junk food out of the house)
  • Make desirable behaviors more convenient (e.g., leave gym clothes ready)
  • Use visual cues to remind you of your goals

By recognizing the power of our environment, we can take a more active role in shaping our behavior and achieving our long-term goals.

4. Short-term emotions often override long-term considerations

"When we're not hungry and someone asks us how many desserts we will eat over the next month, we might think that we will have one or maybe two max. However, when we're at a restaurant and the waiter places the dessert menu (or even worse, the dessert tray) in front of us and we see our favorite dessert listed as an option, we get a very different idea about the importance of having dessert right now."

Emotions drive decisions. Our immediate feelings and desires often have a stronger influence on our choices than our rational, long-term considerations. This can lead to decisions that feel good in the moment but may not align with our broader goals or values.

• Strategies to manage emotional decision-making:
  • Implement cooling-off periods before making important decisions
  • Pre-commit to decisions when in a "cold" emotional state
  • Practice mindfulness to increase awareness of emotional influences

By recognizing the power of emotions in our decision-making process, we can develop strategies to better align our choices with our long-term interests.

5. Self-control is a limited resource that depletes over time

"All day long, we face small temptations and do our best to resist them. We maintain control over ourselves and the temptations around us in an effort to be productive, responsible people and stop ourselves from giving in to our urges to shop, procrastinate, watch that latest cat video on YouTube, and so forth."

Willpower is finite. Our ability to resist temptation and make disciplined choices diminishes throughout the day as we repeatedly exercise self-control. This depletion effect can lead to poorer decision-making and increased vulnerability to temptation later in the day.

• Strategies to manage willpower depletion:
  • Prioritize important decisions earlier in the day
  • Create routines and habits to reduce decision fatigue
  • Use environmental cues and constraints to support good choices

Understanding the limited nature of self-control can help us structure our days and environments to support better decision-making and goal achievement.

6. We adapt quickly to changes, but some experiences resist adaptation

"While we adapt to many things rather successfully, there are some things that we don't adapt to, or at least not that easily. One of these, sadly, is commuting—that annoying daily trip from the small neighborhood where we live to our place of work in the big city."

Adaptation is not universal. While humans have a remarkable ability to adjust to new circumstances, some experiences consistently impact our well-being without diminishing over time. Understanding which experiences we adapt to and which we don't can help us make better decisions about how to allocate our time and resources.

• Experiences that resist adaptation:
  • Commuting
  • Chronic pain
  • Noise pollution

By focusing on improving aspects of our lives that persistently affect our happiness, we can achieve more lasting improvements in our overall well-being.

7. Honesty is malleable and context-dependent

"When we have a longtime commitment to a particular doctor, it's hard to ignore this relationship and our feeling of obligation. But, when we think about giving advice to other people, we can disengage from our emotions to some degree, look at the big picture, and recommend a better course of action—such as getting a second opinion."

Honesty fluctuates. Our tendency to be honest or dishonest is influenced by various contextual factors, including social relationships, perceived norms, and the way information is presented. Understanding these influences can help us design environments and systems that promote more ethical behavior.

• Factors that influence honesty:
  • Social distance (e.g., easier to be dishonest with strangers)
  • Ambiguity (e.g., easier to rationalize dishonesty when rules are unclear)
  • Perceived fairness of the system

By recognizing the malleable nature of honesty, we can create contexts that encourage more ethical behavior in ourselves and others.

8. The way choices are framed significantly impacts our decisions

"Luckily the technology you need to solve this problem is already at your disposal. All you need is a coin. Assign each car to a side of the coin, and flip it high in the air. At this point, you can wait until the coin lands, and use this random device to make your choice—but my guess is that when the coin is in the air, you will realize which car is the one you really want."

Framing matters. The way options are presented can have a profound impact on our choices, often more so than the actual content of the options themselves. By understanding and leveraging framing effects, we can improve decision-making processes and outcomes.

• Examples of framing effects:
  • Default options (e.g., opt-out vs. opt-in for organ donation)
  • Loss aversion (e.g., emphasizing potential losses vs. gains)
  • Decoy effects (e.g., introducing a third, less attractive option)

Recognizing the power of framing can help us make better decisions and design more effective policies and interventions.

9. Our predictions about future happiness are often inaccurate

"Your question is really about the roots of your unhappiness. Is it caused by the job or by you? If your unhappiness is based on your particular job, then switching is a good path to a better future. On the other hand, if the cause for your misery is you, then switching is going to be of no use, because, as the saying goes: 'no matter where you go, there you are,' and you will still be there to make your new job just as miserable."

Happiness is hard to predict. We often misjudge how future events or changes will impact our happiness, leading to poor decisions about major life choices. This difficulty in predicting our emotional reactions stems from various cognitive biases and our tendency to overestimate the impact of individual factors on our overall well-being.

• Reasons for poor happiness predictions:
  • Focusing illusion (overemphasizing one aspect of a situation)
  • Neglecting adaptation (underestimating our ability to adjust)
  • Projection bias (assuming future preferences will match current ones)

By recognizing our limitations in predicting future happiness, we can approach major life decisions with more caution and seek more reliable sources of information, such as the experiences of others in similar situations.

10. Small interventions can lead to significant behavioral changes

"Now that I think about it, maybe we should start giving fashion tips."

Nudges work. Often, small changes in how choices are presented or subtle interventions in our environment can lead to significant shifts in behavior. These "nudges" can be powerful tools for improving decision-making and outcomes across various domains of life.

• Examples of effective nudges:
  • Using smaller plates to reduce food consumption
  • Automatically enrolling employees in retirement savings plans
  • Placing healthier food options at eye level in cafeterias

Understanding the power of small interventions can help us design more effective policies and personal strategies for achieving desired outcomes without resorting to heavy-handed mandates or drastic lifestyle changes.

Last updated: September 7, 2024