Predictably Irrational: The Hidden Forces That Shape Our Decisions | Dan Ariely

Predictably Irrational: The Hidden Forces That Shape Our Decisions | Dan Ariely | not so arbitrarily coherent

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Predictably Irrati...

	Predictably Irrational: The Hidden Forces That Shape Our Decisions Dan Ariely HarperCollins, 2008 - 304 pages average customer review:based on 144 reviews view larger image
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highly recommended

Wonderful Study!

This is a very good book with rational explanations of the irrational paths we trod. Thanks Dan for letting a wrenching personal experience evolve into a wonderful expose of actual human thinking and endeavor.

not so arbitrarily coherent

Ariely writes of, among other things, arbitrary coherence. The mind has a thought based on expectation, excitement or bias. Every thought thereafter complies with this original thought for the purpose of creating coherence. The problem is that the validity of the ensuing thoughts are never tested.
The thoughts in this book, on the other hand, build a deliberate case based on explored hypotheses. The social scientist that Ariely is compels him to invent and test many social experiments which highlight our tendancies to fool ourselves.
Predictably Irrational is both extraordinarily researched and entertaining to read.

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The title Could Apply to Certain Economists

For some time now, economists have been talking about rational people and rational behavior. The more they've talked, the more puzzled the rest of us have become, because what they talk about often has no visible relationship to anything that exists in reality. "Rational behavior" is sometimes among the most far-fetched imaginable. This book offers an example on page 64:

"The rational consumer would estimate the amount of pleasure he expects to get from the Hershey's Kiss (let's say this is five pleasure units) and subtract the displeasure he would get from paying one cent (let's say this is one displeasure unit)."

Now I've never in my life tried to calculate numerical pleasure units for a Hershey's Kiss or anything else. Nor has anyone else I know, and I'm willing to bet you haven't either. That no one would want to suck the joy out of a piece of candy in that manner is common sense. To economists, however, measuring the pleasure units of a chocolate is all in a day's work.

Dan Ariely is one economist who is catching up to what the rest of the world already knows. "Predictably Irrational" is about his experiments in economics, all of which prove that ordinary people don't do what economists want them to do. I won't argue with the experiments. Most of them look sound, though there are flaws in a couple. The big problem here is not what Ariely got wrong, but what he got right. As a whole, the book demonstrates less how out of it people are and more how out of touch economists are.

For instance, there's a chapter on "The Cost of Social Norms". Ariely concludes that people behave differently under social norms than under market norms. In other words, we'll help out friends and family happily and freely. Once money is involved, however, we'll want decent pay. This, one would imagine, is obvious. Lesser minds than Ariely's would have sufficed to discover it.

What really threw me was the discussion at the end of the chapter. Ariely describes his experience at Burning Man, a festival where people exchange what they need without cash. Ariely remarks that it was a pleasant, low-stress experience. He says, "Could there be some aspects of our life that would be, in some ways, better without money? That's a radical idea, and not an easy way to imagine."

Now, here's the rub. I can imagine it easily. So could most other people. Of course the invasion of money into our private lives has made things less pleasant. Of course we'd be happier if we did more things on a friend-to-friend basis. Of course life would be better if we worried about our finances less. I'd reckon that every sensible person thinks so. The idea is not "radical". It's one of the most mainstream ideas around.

Ariely frequently designs experiments to prove things that are already known and makes `radical' new conclusions that are actually quite old. By itself, this might be funny. However, his unawareness of most human thinking also leads to wrong conclusions and bad solutions for the problems mentioned.

For example, he has a chapter called The Influence of Arousal. He concludes that arousal is influential; we make different decisions when turned on--by sex or other things--than when we're `cold'. Again, no surprises there. Ariely acknowledges that this has been known for a while. He references Stevenson's classis "Dr. Jekyll and Mr. Hyde", though he could as easily have quoted the Apostle Paul. ("My own behavior baffles me. For I find myself not doing what I really want to do but doing what I really loathe. Yet surely if I do things that I really don't want to do, it cannot be said that I am doing them at all,--it must be sin that has made its home in my nature." [Rom 7:16-7])

What Ariely doesn't seem to know is that the human race has techniques for grappling with these problems. His solutions are mechanical. Cars should measure and respond to the driver's emotional state. Credit cards should impose limits on how much we can spend. Yet these fixes might well create problems of their own. Why not instead return to the wisdom that civilization is based on? Many people have successfully conquered their reptilian selves and achieved a greater unity, not only in our society but all over the world. It takes effort, of course, so a technological quick fix sounds appealing, but we need something that's proven to work.

Ariely's problem is most acute in two chapters on honesty at end. He proves that many people are dishonest (surprise!) and also looks at honesty in different circumstances. For instance, he finds less cheating when people deal with cash than with other forms of money. This may be interesting, but again his solutions again are small and unlikely to work. He mentions ethics classis in college and graduate programs. Morality, however, starts in grade school, not grad school. Raising an honest person is a lifelong effort. Our society's falling ethical standards cannot be fixed with a band-aid.

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