“Thinking, fast and slow” by Daniel Kahneman
When 9/11 happened, the world suddenly feels like a much dangerous place. When Malaysian Air planes crashed almost nobody wanted to fly with them anymore. When your teenage daughter comes home late from a party you can’t help but imagining all sorts of crimes you read on the news. These are the examples of cognitive bias, a big part of our decision making process. And this book is about how to recognise them and how control them.
The book is written by Daniel Kahneman, the only Nobel Prize Winner on Economics who is actually NOT an economist but a psychologist. Due to his scientist nature the theories he presented in the book have been tested, published, peer-reviewed, and re-tested by many more scientists. And he also uses a lot more theories in the book that are based on experiments made by these peers, to make some excellent points.
The result is an exceptional book, a complex sets of extraordinary findings written in a simple language that makes them easy to digest. Findings that look at decision making process using very specific filters.
First, there is the Halo Effect filter, and the importance of moving first (to establish an anchor or parameter) in a single-issue negotiations. Then there’s a Hindsight Bias, as Kahneman argues “If an event had actually occurred, people exaggerated the probability that they had assigned to it earlier. If the possible event had not come to pass, the participants erroneously recalled that they had always considered it unlikely.”
Furthermore, there’s also Availability Heuristic, which points out that just because the information is readily available in your mind it doesn’t make it right. For example, all the constant gossips about Hollywood celebrity divorces makes you think that celebrity divorces are common compared with ordinary couple. Or after you become a victim of a crime you suddenly feel that the world is not a safe place anymore. Or after watching so many spy movies suddenly every corner of the earth is a conspiracy. Or just because one kid becomes autistic after vaccinated you think that vaccination causes autism.
Moreover, the chapter on Anchoring Effect makes father of spin Edward Bernays looks like an amateur, in which kahneman makes a very vital remarks in this data-driven world: “The world in our heads is not a precise replica of reality; our expectations about the frequency of events are distorted by the prevalence and emotional intensity of the messages to which we are exposed.”
There are also several interesting facts about the small things in our daily lives. Such as his interesting approach to dismantling regret. Or the scientific answers to some of the questions that have been lingering on my mind, like the illusion of time, in which he answers with the Duration Neglect in chapter 35 and 36. Or the power of smiling and frowning, where frowning generally increases the vigilance of what Kahneman called System 2, and reduces both overconfidence and the reliance on intuition.
But the most mind-blowing for me, out of many, is the interesting thing that is happening in our brain when we change our mind. As Kahneman put it, “A general limitation of the human mind is its imperfect ability to reconstruct past states of knowledge, or beliefs that have changed. Once you adopt a new view of the world (or of any part of it), you immediately lose much of your ability to recall what you used to believe before your mind changed.” In other words we can actually change the past, by changing the way we look at it.
All in all, this is one of the most intelligent books I’ve ever read, that gives us the manual of the inner workings of our thought processes. Reading it can help us understand the wiring in our brain and how we can make the most efficient use of it, for our decision making process. And that, is why he won the Nobel Prize.