36. Thinking, Fast and Slow - Daniel Kahneman (📖)

16 Oct 2017

Reading Notes:

the psychology of accurate intuition involves no magic

“The situation has provided a cue; this cure has given the expert access to information stored in memory, and the information provides the answer. Intuition is nothing more and nothing less than recognition.”

The intuitive system 1 is more influential than your experience tells you, and it is the secret author of many of the choices and judgements you make.

Why is it so difficult for us to think statistically? We easily think associatively, we think metaphorically, we think casually, but statistics require thinking about many things at once, which is something System 1 is not designed to do.

System 1 operates automatically and quickly, with little or no effort and no sense of voluntary control.

System 2 allocates attention to the effortful mental activities that demand it, including complex computations. The operations of System 2 are often associated with the subjective experience of agency, choice and concentration.

Intense focusing on a task can make people effectively blind, even to stimuli that normally attract attention. The most dramatic demonstration was offered by Christopher Chabris and Daniel Simons in their book, The Invisible Gorilla.

Constantly questioning our own thinking would be impossibly tedious, and System 2 is too much slow and inefficient to serve as a substitute for System 1 in making routine decisions. The best we can do is a compromise: learn to recognize situations in which mistakes are likely and try harder to avoid significant mistakes when stakes are high.

As you become skilled in a task, its demand for energy diminishes.

“flow”, “a state of effortless concentration so deep that they lose their sense of time, of themselves, of their problems.”

self-control is tiring; if you have had to force yourself to do something, you are less willing or less able to exert self-control when the next challenge comes around. This phenomenon has been named ego depletion.

A bat and ball costs $1.10 The bat costs one dollar more than the ball. How much does the ball cost?

The bat and ball problem is our first encounter with an observation that will be a recurrent theme of this book: Many people are overconfident, prone to place too much faith in their intuitions. They apparently find cognitive effort at least mildly unpleasant and avoid it as much as possible.

If System 1 is involved, the conclusion comes first and the arguments follow.

Simple, common gestures can also unconsciously influence our thoughts and feelings.

You can see why the common admonition to “act calm and kind regardless of how you feel” is very good advice: you are likely to be rewarded by actually feeling calm and kind.

The study of priming has come some way from the initial demonstration that reminding people of old age makes them walk more slowly.

Reminders of money produce some troubling effects.

Money-primed people are also more selfish: they were much less willing to spend time helping another student who pretended to be confused about an experimental task.

The general theme of these findings is that the idea of money primes individualism.

If you had been exposed to a screen saver of floating dollar bills, you too would likely have picked up fewer pencils to help a clumsy stranger.

If you use color, you are more likely to be believed if your text is printed in bright blue.

Cognitive strain, whatever its source, mobilizes System 2, which is more likely to reject the intuitive answer suggested by System 1.

Mood evidently affects the operation of System 1: when we are uncomfortable and unhappy, we lose touch with our intuition.

System 1 does not keep track of alternatives that it rejects, or even of the fact that there were alternatives. Conscious doubt is not in the repertoire of System 1; it requires maintaining incompatible interpretations in mind at the same time, which demands mental effort. Uncertainty and doubt are the domain of System 2.

System 1 is gullible and biased to believe, System 2 is in charge of doubting and unbelieving, but System 2 is sometimes busy, and often lazy. Indeed, there is evidence that people are more likely to be influenced by empty persuasive messages, such as commercials, when they are tired and depleted.

It is the consistency of the information that matters for a good story, not its completeness. Indeed, you will often find that knowing little makes it easier to fit everything you know into a coherent pattern.

cold cuts described as “90% fat-free” are more attractive than when they are described as “10% fat.”

How may dates did you have last month? How happy are you these days?

Happiness these days is not a natural or easy assessment. A good answer requires a fair amount of thinking.

The present state of mind looms very large when people evaluate their happiness.

Self-criticism is one of the functions of System 2.

people:

• are less confident in a choice when they are asked to produce more arguments to support it.
• are less impressed by a car after listing many of its advantages.

people form opinions and make choices that directly express their feelings and their basic tendency to approach or avoid, often without knowing that they are doing so.

“Risk” doesnot exist “out there,” independent of our minds and culture, waiting to be measured. Human beings have invented the concept of “risk” to help them understand and cope with the dangers and uncertainities of life.

The importance of an idea is often judged by the fluency (and emotional charge) with which that idea comes to mind.

The Alar tale illustrates a basic limitation in the ability of our mind to deal with small risks: we either ignore them altogether or give them far too much weight – nothing in between.

Individuals feel relieved of responsibility when they know that others have heard the same request for help.

You are more likely to learn something by finding surprises in your own behavior than by hearing surprising facts about people in general.

Our mind is strongly biased towards casual explanations and does not deal well with “mere statistics.”

“Narrative Fallacy” - Taleb introduced the notion of a narrative fallacy to describe how flawed stories of the past shape our views of the world and our expectations for the future. Narrative fallacies arise inevitably from our continuous attempt to make sense of the world.

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.

Because of the Halo effect, we get the casual relationship backward: we are prone to believe that the firm fails because its CEO is rigid, when the truth is that the CEO appears to be rigid because the firm is failing. This is how illusions of understanding are born.

Because luck plays a large role, the quality of leadership and management practices cannot be inferred reliably from observations of success. And even if you had perfect foreknowledge that a CEO has brilliant vision and extraordinary competence, you still would be unable to predict how the company will perform with much better accuracy than a flip of a coin.

statistical fact of life: regression to the mean.