Tuesday, August 11, 2015

Thinking Fast and Slow

Thinking Fast and Slow shows how hard it is to think and how often people avoid it and makes me wonder if anything I know is truly correct. "Considering how little we know, the confidence we have in our beliefs is preposterous".

It is depressing to realize the difficulty of changing our own faulty ideas, let alone changing others. To help myself, I read books like this. When arguing with others, I never aim for really changing them. I don't bother with trying to be fair and give them the benefit of doubt because they never return the favor. I just shut them up with a few simple tactics so that they don't think that what they present is irrefutable brilliance. Schopenhauer's "Die Kunst, Recht zu behalten" has good techniques.

Thinking as correctly as possible is not some academic detail. I recently had to confront two important, life-changing challenges: One was which house to buy and the other was whether my mother should have a risky operation. With rationality and luck, both turned out very well (We bought the best house possible and my mother rejected the operation which in hindsight was a good decision).

Another application of this book might be using it when raising a child (I have a 3 year old son). The hard way is to use rationality and correctness of argument. The easy way would be to appeal to the inherent weaknesses present in every human being [as politicians and marketers do].

The moral of the story is: be aware of your limitations (this book is for that) and think... a lot! In a state of flow... maintaining focused attention on... absorbing activities requires no exertion of self-control thereby freeing resources to be directed to the task at hand.

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

One of the main functions of System 2 is to monitor and control thoughts and actions "suggested" by System 1, allowing some to be expressed directly in behavior and suppressing or modifying others.

...when people believe a conclusion is true, they are also very likely to believe arguments that appear to support it, even when these arguments are unsound. If System 1 is involved, the conclusion comes first and the arguments follow.

...your actions and your emotions can be primed by events of which you are not even aware. [A good reason not to watch the news and advertisements]

..."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.

...your subjective experience consists largely of the story that your System 2 tells itself about what is going on. Priming phenomena arise in System 1, and you have no conscious access to them.

A reliable way to make believe in falsehoods is frequent repetition, because familiarity is not easily distinguished from truth. Authoritarian institutions and marketers have always known this fact. [Yet another reason to avoid the news]

Jumping to conclusions is efficient if the conclusions are likely to be correct and the costs of an occasional mistake acceptable, and if the jump saves much time and effort.

The tendency to like (or dislike) everything about a person - including things you have not observed - is known as the halo effect.

...before an issue is discussed, all members of the committee should be asked to write a very brief summary of their position. This procedure makes good use of the value of the diversity of knowledge and opinion in the group. The standard practice of open discussion gives too much weight to the opinions of those who speak early and assertively, causing others to line up behind them.

...you will often find that knowing little makes it easier to fit everything you know into a coherent pattern [See Bertrand Russel's quote]

...sustaining doubt is harder work than sliding into certainty.

...a strategy of deliberately thinking the opposite may be a good defense against anchoring effects, because it negates the biased recruitment of thoughts that produce these effects.

...System 2 works on data that is retrieved from memory, in an automatic and involuntary operation of System 1. System 2 is therefore susceptible to the biasing influence of anchors that make some information easier to retrieve.

...[people] are less confident in a choice when they are asked to produce more arguments to support it.

...rewards for improved performance work better than punishment of mistakes.

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

The control group is expected to improve by regression alone, and the aim of the experiment is to determine whether the treated patients improve more than regression can explain.

Perhaps the most valuable contribution of the corrective procedures I propose is that they will require you to think about how much you know.

The explanatory stories that people find compelling are simple; are concrete rather than abstract; assign a larger role to talent, stupidity, and intentions than to luck; and focus on a few striking events that happened rather than on the countless events that failed to happen.

Once you adopt a new view of the world... you immediately lose much of your ability to recall what you used to believe before your mind changed.

Although hindsight and the outcome bias generally foster risk aversion, they also bring undeserved rewards to irresponsible risk seekers, such as a general or entrepreneur who took a crazy gamble and won.

Because luck plays a large role, the quality of leadership and management practices cannot be inferred reliably from observations of success.

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. Considering how little we know, the confidence we have in our beliefs is preposterous...

Facts that challenge... basic assumptions - and thereby threaten people's livelihood and self-esteem - are simply not absorbed.

...people can maintain an unshakable faith in any proposition, however absurd, when they are sustained by a community of like-minded believers.

...the person who acquires more knowledge develops an enhanced illusion of her skill and becomes unrealistically overconfident.

...to maximize predictive accuracy, final decisions should be left to formulas, especially in low-validity environments. [See The Checklist Manifesto]

...confidence that people have in their intuitions is not a reliable guide to their validity.

Statistical algorithms greatly outdo humans in noisy environments for two reasons: they are more likely than human judges to detect weakly valid cues and much more likely to maintain a modest level of accuracy by using such cues consistently.

...people who have information about an individual case rarely feel they need to know the statistics of the class to which the case belongs.

The chances that a small business will survive for five years in the United States are about 35%. But the individuals who open such businesses do not believe that the statistics apply to them.

...the financial benefits of self-employment are mediocre: given the same qualifications, people achieve higher average returns by selling their skills to employers than by setting out on their own. [Be self employed for the correct reasons which might be to be more in control by giving up some financial comfort].

...people and firms reward the providers of dangerously misleading information more than they reward truth tellers [See Waltzing with Bears]

An unbiased appreciation of uncertainty is a cornerstone of rationality - but it is not what people and organizations want.

[Loss aversion at work:] ...plans for reform almost always produce many winners and some losers while achieving an overall improvement. If the affected parties have any political influence, however, potential losers will be more active and determined than potential winners; the outcome will be biased in their favor and inevitably more expensive and less effective than initially planned.

System 2 may "know" that the probability is low, but this knowledge does not eliminate the self-generated discomfort and wish to avoid it. System 1 cannot be turned off.

The more vivid description produces a higher decision weight for the same probability.

Closely following daily fluctuations [of the stock market] is a losing proposition, because the pain of the frequent small losses exceeds the pleasure of the equally frequent small gains.

Except for the very poor... money is a proxy for points on a scale of self-regard and achievement.

...people expect to have stronger emotional reactions (including regret) to an outcome that is produced by action than to the same outcome when it is produced by inaction.

...people generally anticipate more regret than they will actually experience, because they underestimate the efficacy of the psychological defenses they will deploy...

The high-donation [organ] countries have an opt-out form, where individuals who wish not to donate must check an appropriate  box. [Importance of defaults because people don't want to think]

If you believe that a large supply of donated organs is good for society, you will not be neutral between a formulation that yields almost 100% donations and another formulation that elicits donations from 4% of drivers.

...I am my remembering self, and the experiencing self, who does my living, is like a stranger to me.

One reason for the low correlations between individuals' circumstances and their satisfaction with life is that both experienced happiness and life satisfaction are largely determined by the genetics of temperament.

The voice of reason may be much fainter than the loud and clear voice of an erroneous intuition, and questioning your intuitions is unpleasant when you face stress of a big decision. More doubt is the last thing when you are in trouble. The upshot is that it is much easier to identify a minefield when you observe others wandering into it than when you are about to do so. Observers are less cognitively busy and more open to information than actors.
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