Review

Very interesting, but rather lengthy
Could be separated into few, more detailed books

Notes

Book will enrich your vocabulary when talking about judgments, choices, decisions.
Even if you don't intend to follow every word written in book, it could be beneficiary to you.

Opinions & gossips are mostly shared at common places like office watercooler.
Go to places where common people meet – pubs, spas, gyms, schools, ...

It's easier to identify and label mistakes of others then recognize our own.
Watch others mistakes and learn from them

Intelligent gossip matters and should be motive for self-criticism.
Do not act on gossips, but try to rationally consider their origin.

Most impressions and thoughts arise in your conscious experience without your knowing how they got there.
Try meditating, taking perception-free naps, relax without watching TV… give your own mind a little space.

We are often confident even when we are wrong, and an objective observer is more likely to detect our errors than we are.
Do not stubbornly believe to anything.

Improve the ability to identify and understand errors of judgment and choice, in others and eventually in ourselves, by providing a richer and more precise language to discuss them.
Learn some basic theoretical principles, fables and manifestations of biases to better recognize them in real world.

It is much easier to strive for perfection when you are never bored.
Have fun, challenge yourself, compete with others, gamify learning & work.

Study theoretical subjects to have intuitive knowledge of the range of possible results.
Study math to have intuitive knowledge what computational method is best for a exercise.

Intuitive answer – first one that came to mind, the one we were tempted to make even when we knew it to be wrong.

Freedom has a cost, which is borne by individuals who make bad choices, and by a society that feels obligated to help them.

Nudging – help people make good decisions without curtailing their freedom. Nudge people to make decisions that serve their own long-term interests.

Deviating from the normal choice is an act of commission, which requires more effortful deliberation, takes on more responsibility, and is more likely to evoke regret than doing nothing
Use this for default values in UX

Presentation greatly matters; if, for example, a potential outcome is framed as a loss, it may have more impact than if it is presented as a gain.

Different choice of measure – death per million people / death per million dollars of product produced.

Overreaction to a minor problems – we either ignore them altogether or give them far too much weight.
All kinds of media popularized diseases – pig flue, bad meat, …

Availability cascades - terrorists. Distort priorities in the allocation of public resources.
Strict check-ups at airports

Policy makers must endeavor to protect the public from fear, not only from real dangers.

Distinctive stereotype – good fit to small fields (computer scientists, librarians, engineers) and a poor fit to the most populated specialties (humanities and education, social science and social work).

Regression to mean paradox: 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.

Success = talent + luck great success = a little more talent + a lot of luck

Highly intelligent women tend to marry men who are less intelligent than they are. – can be explained just by regression to mean.
our mind is strongly biased toward causal explanations and does not deal well with “mere statistics

Causal explanations will be evoked when regression is detected, but they will be wrong because the truth is that regression to the mean has an explanation but does not have a cause.»»regression to mean««

Do not choose extreme sample groups, subject can be effected just by regression and nothing else.

Denominator neglect – If your attention is drawn to the winning marbles, you do not assess the number of nonwinning marbles with the same care.
*1/10 is intuitively less probable than 8/100*
Duration neglect: The duration of experience has almost no effect whatsoever on the ratings of total experience. Memory of experience depends on the beginning, the peak, and the end.
Reduce memory of bad experience bad slowly graduating to better in the end

Memories are all we get to keep from our experience of living, and the only perspective that we can adopt as we think about our lives is therefore that of the remembering self.

Fictitious Econs, who live in the land of theory, and the Humans, who act in the real world.

We favors a short period of intense joy over a long period of moderate happiness.

Last moment paradox – Why do we care so much about last 10 minutes of life/movie/etc?

A story is about significant events and memorable moments, not about time passing.

We all care intensely for the narrative of our own life and very much want it to be a good story, with a decent hero.

We thing buying a fancy car would make us happier, but it turns out to be an error of affective forecasting.

During life, we are constructing stories and collecting memories.
Can we design our own memory of events like a photographer arrange a scene?

People choose by memory when they decide whether or not to repeat an experience

Difficulty of distinguishing memories from experiences.

Experiment: At the end of the vacation, all pictures and videos will be destroyed. Furthermore, you will swallow a potion that will wipe out all your memories of the vacation. How would you behave?

If you combine eating with other activities, like watching TV, the pleasure form eating will be diluted.

Happiness is the experience of spending time with people you love and who love you

The satiation level beyond which experienced well-being no longer increases is a household income of about $75,000.

The easiest way to increase happiness is to control your use of time.

Decision to get married reflects, for many people, a massive error of affective forecasting

Our attention is withdrawn from a new situation as it becomes more familiar. The main exceptions are chronic pain, constant exposure to loud noise. Pain and noise are biologically set to be signals that attract attention, and depression involves a self-reinforcing cycle of miserable thoughts.
Tinnitus

Denominator neglect – 0.001% risk / One of 100,000 vaccinated children will be permanently disabled

Concept of regression is far from obvious.

Forecasting – Life presents us with many occasions to forecast. Economists forecast inflation and unemployment, financial analysts forecast earnings, military experts predict casualties, venture capitalists assess profitability, publishers and producers predict audiences, contractors estimate the time required to complete projects, chefs anticipate the demand for the dishes on their menu, engineers estimate the amount of concrete needed for a building, fireground commanders assess the number of trucks that will be needed to put out a fire. In our private lives, we forecast our spouse’s reaction to a proposed move or our own future adjustment to a new job.

We all have a need for the reassuring message that actions have appropriate consequences, and that success will reward wisdom and courage.

The basic message of successful stories books is that good managerial practices can be identified and that good practices will be rewarded by good results. Both messages are overstated. – narrative fallacy.

The amount of evidence and its quality do not count for much, because poor evidence can make a very good story. For some of our most important beliefs we have no evidence at all, except that people we love and trust hold these beliefs.

Men acted on their useless ideas (and intuition) significantly more often than women, and that as a result women achieved better investment results than men.

People are overconfident in their intuitions, they will assign too much weight to their personal impressions and too little weight to other sources of information, lowering validity. Replace with precise algorithms with consistent standards for gathering answers.

They know they are skilled, but they don’t necessarily know the boundaries of their skill

Our sympathies lie with our fellow human, we do not like the idea that machine is better that our mind (in algorithmic tasks).

Increase sales by putting “All Natural” or “No Preservatives” on the label.

Disciplined collection of objective information and disciplined scoring of separate traits, one at a time strictly separately – method for good questioners.

Whenever we can replace human judgment by a formula, we should at least consider it.

When analysing (e.g. person), six dimensions – as independent as possible – is about good number.

Bayesian statistics – how people should change their mind in the light of evidence.

Paradox: “feminist bank teller” as more probable than “bank teller.”

To teach students psychology, you need to surprise them. But not with statistics, but by individual cases and then statistics.

If someone disagree, allow them to write a paper and make research on this problem.

Intuition is nothing more and nothing less than recognition.

Emotional learning is quick, but expertise takes a long time.

Intuition cannot be trusted in the absence of stable regularities in the environment

To develop intuition, you need immediate and quality feedback on your actions.
Anesthesiologists can developer better intuition than surgeons.

Proper way to elicit information from a group is not by starting with a public discussion but by confidentially collecting each person’s judgment.
Asking group of students all at once is bad practise.

When analysing your chances, make a connection with knowledge of history of similar projects. Our estimates were closer to a best-case scenario than to a realistic assessment. The divorces, the illnesses, the crises of coordination with bureaucracies could not be anticipated.

Baseline prediction: prediction you make about a case if you know nothing except the category to which it belongs. Should be the anchor for further adjustments.

Planning fallacy – plans and forecasts that are unrealistically close to best-case scenarios could be improved by consulting the statistics of similar cases.
Estimations of costs of buildings, highways, …
*Driven by the desire to get the plan approved—whether by their superiors or by a client—supported by the knowledge that projects are rarely abandoned unfinished merely because of overruns in costs or completion times* Obtain the statistics of the reference class, specific information about the case to adjust the baseline prediction.

Goals we adopt as more achievable than they are likely to be.

Many individuals believe statistics do not apply to them.

Sell your skills to employers rather than setting out your own business – more likely to success, statistically.

Optimism is widespread, stubborn, and costly.

Prestigious press awards to the CEO are costly to stockholders.

90% of drivers believe they are better than average.

Outcome of a start-up depends as much on the achievements of its competitors and on changes in the market as on its own efforts. Avoid competition neglect.

Brand new business are ofter optimistic martyrs – good for the economy but bad for their investors.

People are paid to look knowledgeable – even if they knew how little they know, they would be penalized for admitting it.

Most overconfident experts were the most likely to be invited to strut their stuff in news shows.
Tomáš Sedláček

The prevalent tendency to underweight or ignore distributional information is perhaps the major source of error in forecasting.

The outside view is implemented by using a large database, which provides information on both plans and outcomes for hundreds of projects all over the world, and can be used to provide statistical information about the likely overruns of cost and time, and about the likely underperformance of projects of different types.

Knowledge is often noted and promptly set aside.

Expertise is not a single skill; it is a collection of skills, and the same professional may be highly expert in some of the tasks in her domain while remaining a novice in others.

Rewards for improved performance work better than punishment of mistakes.
Counterexamples can be disproved by regression to the mean, which in that case was due to random fluctuations.
*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.*
Pigeons, rats, humans, and other animals have common basic behaviour.

Orienting to a loud sound is normally an involuntary operation of System 1.
Can it be unlearned to be able to focus in open-space offices?

We dispose limited budget of attention that can be allocated to consciousness activities, if we try to go beyond budget, we will fail. Switching from one task to another is effortful, especially under time pressure.
Multitasking problem

Mild physical arousal of the walk may spill over into greater mental alertness.
Healthy body is important to healthy mind.

We can be blind to the obvious, and we are also blind to our blindness. – Gorilla experiment on selective attention http://youtu.be/vJG698U2Mvo

Our mind deals better with interpretation of stories about active agents, who have personalities, habits, and abilities.
Copywriters and designers take advantage of this.

Add-1 task – keep multiple digit number in memory and keep incrementing each numeral individually.

Eyes (pupils) – window to our soul. Being engaged in a mental sprint, may become effectively blind.

Flow – State of effortless concentration so deep that they lose their sense of time, of themselves, of their problems – optimal experience. Concentration on the task and the deliberate control of attention.

Too much concern about how well one is doing in a task sometimes disrupts performance by loading short-term memory with pointless anxious thoughts.

After exerting self-control in one task, give your self-control a break with something easy.
Plan your day with hard-easy-hard-easy tasks pattern.

Tired and hungry judges tend to fall back on the easier default position of denying requests for parole. Both fatigue and hunger probably play a role.
Negotiate with people when they are in a good mood. This applies even for relationships.

Storytime: people are first depleted by a task in which they eat virtuous foods such as radishes and celery while resisting the temptation to indulge in chocolate and rich cookies. Later, these people will give up earlier than normal when faced with a difficult cognitive task.
Try to recognize these types of behaviours in your friend and study if it has affect on their other behaviour.
I don't like fat people because they are fat, but because their lack of self control

Mental illusion – intuitive, appealing, and wrong.
In important problems, try to resist the intuition.

Many people are overconfident, prone to place too much faith in their intuitions. Event unwilling to invest the effort to check their intuitions. Eg. bat-and-ball problem.

Intelligence is not only the ability to reason; it is also the ability to find relevant material in memory and to deploy attention when needed. Be more alert, more intellectually active, less willing to be satisfied with superficially attractive answers, more skeptical about intuitions.

Children who had shown more self-control as four-year-olds had substantially higher scores on tests of intelligence. Experiment: 1 cookie now or 2 cookies after undisturbed waiting.

Ideas – nodes in a vast network, called associative memory, in which each idea is linked to many others.

Ideomotor effect – influencing of an action by the idea, subject make unconsciousness decisions and are even convinced that they are originated within themselves.

Our body language affects our mind – even forced smile can make us happier.
Act as you would actually like to feel

When primed by money, we are more involved, self-reliant but also more selfish and less willing to help.

Purely symbolic reminder of being watched prodded people into improved behavior.

When you feel strained, you make fewer errors, but also are less intuitive and less creative.

Repetition of an arbitrary stimulus lead to affection for it. Even at animals (repeated exposure of a stimulus followed by nothing bad » safety signal » safe is good)
Used by music hits played over and over in radio.

Creativity – associative memory that works exceptionally well.
Be polyglot, have broad knowledge instead of deep.

When in a good mood, people become more intuitive and more creative but also less vigilant and more prone to logical errors
Shopping trips for seniors with food, travel, …
Be extra careful when in good mood – do not make promises when you are happy.

Before assessing happiness in life/relationship/business – first made some of their subjects happy and others sad, by asking them to think for several minutes about happy or sad episodes in their lives.

People are more likely to be influenced by empty persuasive messages, such as commercials, when they are tired and depleted.
Do not watch TV when you want to relax.

Positive test strategy – Is Sam friendly?” different instances of Sam’s behavior will come to mind than would if you had been asked “Is Sam unfriendly.

Halo effect – tendency to like (or dislike) everything about a person—including things you have not observed.
*Effect of facial competence on voting is about three times larger for information-poor and TV-prone voters than for others who are better informed and watch less television. * Used for commercials, president elections.

If I like generous people, and I like Jane, I will think of Jane as a generous person.
Love blindness to bad behaviour

First impression will change meaning of facts that appear later.
A: intelligent—industrious—impulsive—critical—stubborn—envious
B: envious—stubborn—critical—impulsive—industrious—intelligent

Almost complete neglect of quantity emotional contexts – we give same amount of money to save 1000 animals and 10000 animals.

Mental shotgun – impossible to aim at a single thought.

Irrelevant answer can disrupt performance (need to employ System 2).
Make UX usable without thinking, eg. button [save] rather than [ok]

If you can’t solve a problem, then there is an easier problem you can solve: find it.

Likes and dislikes determine people beliefs about the world. System 1 generates impressions, feelings, and inclinations; when endorsed by System 2 these become beliefs, attitudes, and intentions.

Do we still remember the question we are trying to answer? Or have we substituted an easier one?
Experiment: Ask set of questions, let respondent write down answers, then ask them about the questions.

Demand background statistical information on all statistical conclusions. »»statistics««

People are not adequately sensitive to sample size. Eg. 150 vs. 3000 subjects. »»statistics««

The truth is that small samples are not better/worse on average; they are simply more variable.

We pay more attention to the content of messages than to information about their reliability.»»media««

Anchoring effect – people consider a particular value for an unknown quantity before estimating that quantity.
Anchoring point has to be reasonable to has best effect – human age 0 – 110.
Professionals deny influence, but are influences too.
Discount with limits of 12 per person – anchor.
*You are always aware of the anchor and even pay attention to it, but you do not know how it guides and constrains your thinking, because you cannot imagine how you would have thought if the anchor had been different.* *If you are asked whether Gandhi was more than 114 years old when he died you will end up with a much higher estimate of his age at death than you would if the anchoring question referred to death at 35.* *If you consider how much you should pay for a house, you will be influenced by the asking price.* *Do you now feel a slight numbness in your left leg?” always prompts quite a few people to report that their left leg does indeed feel a little strange.* *The “high anchor” in this experiment was 1,200 feet. For other participants, the first question referred to a “low anchor” of 180 feet. The difference between the two anchors was 1,020 feet. As expected, the two groups produced very different mean estimates: 844 and 282 feet* *When no anchor was mentioned, the visitors at the Exploratorium—generally an environmentally sensitive crowd— said they were willing to pay $64, on average. When the anchoring amount was only $5, contributions averaged $20. When the anchor was a rather extravagant $400, the willingness to pay rose to an average of $143.* Used in advertisement, discount, tele-shopping, buy-now prices in auctions.
Add typical value to donate button.
When negotiating, get other side anchored to specific number.

Media do not just shape what the public is interested in, but also are shaped by it. Editors cannot ignore the public’s demands that certain topics and viewpoints receive extensive coverage. »»media««

Estimates of causes of death are warped by media coverage. The coverage is itself biased toward novelty and poignancy.»»media««

Answer to an easy question (How do I feel about it?) serves as an answer to a much harder question (What do I think about it?

We – people – have illusion of control over our life.

Utility – psychological value of outcome.

The poorer man will happily pay a premium to transfer the risk to the richer one, which is what insurance is about.

The happiness that Ann and Bob experience is determined by the recent change in their wealth, relative to the different states of wealth that define their reference points.

People are not consistent, logical and rational.

We are willing to pay a premium price to avoid the uncertainly – principle of insurance.

If we face options that are all bad, we would rather take risk. If we face various good options with different probability and utility, we would rather take the one with less risk and less utility.
*Which do you choose? Get $900 for sure OR 90% chance to get $1,000* *Which do you choose? Lose $900 for sure OR 90% chance to lose $1,000*
We dislike losing more than you like winning.

The moment we get something to possession, we are less willing to trade it for its price.

Those who stand to lose will fight harder than those who stand to gain.

We tend to overweight small risks and are willing to pay far more than expected value to eliminate them altogether – possibility effect.
High prices of vaccinations

Lottery ticket – not buying only possible jackpot, but also right to dream pleasantly of winning.

Utility at any given moment is determined by both present time and past.

Owning the good appeared to increase its value – endowment effect.

Extreme outcomes (both high and low) are more likely to be found in small than in large samples. »»statistics««
Do not be
Pick too small sample and you are doomed to sampling luck. Choose a sample size by computation, not by intuition.
*Large samples are more precise than small samples. Small samples yield extreme results more often than large samples do. The first statement has a clear ring of truth, but until the second version makes intuitive sense, you have not truly understood the first.* *Now imagine the population of the United States as marbles in a giant urn. Some marbles are marked KC, for kidney cancer. You draw samples of marbles and populate each county in turn. Rural samples are smaller than other samples. Just as in the game of Jack and Jill, extreme outcomes (very high and/or very low cancer rates) are most likely to be found in sparsely populated counties. This is all there is to the story.*
BBBGGG GGGGGG BGBBGB Are the sequences equally likely? The intuitive answer—“of course not!”—is false.

Representativeness – people see patterns where none exists.

Life Happiness

*The students who had many dates were reminded of a happy aspect of their life, while those who had none were reminded of loneliness and rejection* Use pre questions to influence answer about happiness of life.
What is your weight? How many ex-girlfriends do you have? How many hours do you spend with your children? can cause strong implication on succeeding question about happiness in life
*First, list six instances in which you behaved assertively. Next, evaluate how assertive you are.*
Experiment to reduce optimism: “Imagine that we are a year into the future. We implemented the plan as it now exists. The outcome was a disaster. Please take 5 to 10 minutes to write a brief history of that disaster.

Availability heuristic

Easy to think of, more dominant to system 1. Due to medias.
If you cannot easily come up with instances of some behavior, you will likely to conclude that you do not posses this behaviour.
*Less confident that something was avoidable after listing more ways it could have been avoided.* *Students who listed more ways to improve the class rated it higher!* Mass media – little coverage of critical but unexciting issues that provide less drama.
Eg. declining educational standards, overinvestment of medical resources in the last year of life.
*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.* *You will occasionally do more than your share, but it is useful to know that you are likely to have that feeling even when each member of the team feels the same way.*

Intuitive heuristics

When faced with a difficult question, we often answer an easier one instead, usually without noticing the substitution.
Normal state of your mind is that you have intuitive feelings and opinions about almost everything that comes your way
*If you had been asked to estimate the size of the figures, we know from experiments that your answer would have been in inches, not feet.*

Truth illusions

cognitive ease, maximize legibility, rhyme, known and easy readable sources (Artan *Taahhut)* bad font, bluriness can active System 2, which is more likely to reject intuitive answer by System 1.
// TODO

System I

Overconfidence is a direct consequence of features of System 1 that can be tamed—but not vanquished

fast thinking, automatic, quick, no effort, no voluntary control, impulsive, intuitive.

Ignore relevant, but too complex statistical facts and rely exclusively on resemblance.

Detect distances, source of sound, common language phrases, basic emotions, detect social behaviours around you.

Innate skills that we share with other animals.

Resemblance – simplifying heuristic (roughly, a rule of thumb) to make a difficult judgment.

We are born prepared to perceive the world around us, recognize objects, orient attention, avoid losses, and fear spiders.

System 1 provides the impressions that often turn into your beliefs, and is the source of the impulses that often become your choices and your actions.

Cannot be turned off – if you are shown a word on the screen in a language you know, you will read it.

System 1 categorize and stereotypes people.

System 1 does not keep track of alternatives that it rejects, or even of the fact that there were alternatives

initial attempt to believe is an automatic operation of System 1 – even a nonsensical statement will evoke
initial belief. When System 2 is otherwise engaged, we will believe almost anything.
Zneuzito v reklamach na nezvyklych prostredi - highways, gyms, newspaper

Shapedd by evolution to provide a continuous assessment of the main problems that an organism must solve to survive.

System II

slow thinking, effortful mental activities, complex computation, mental/optical illusions, choice, concentration, conscious, reasoning, has beliefs.
Unbelieving as an operation of System 2

Capable of doubt

Disbelieving is hard work, and System 2 is easily tired.

Lazy & reluctant to invest more effort than is strictly necessary.
Can it be controlled?