Some words from Daniel Kahneman's 2013 speech at Yale University.
Why agents don't take advantage of the markets?
Why are they being punished by those called "unfair?"
infant rationality.
People overweigh present than future, they overweigh loss over gain.
They overweigh amount of lottery than winning minuscule chance of winning it. Overweigh the gained knowledge than future acquired knowledge.
People underweight certain things. They underweight statistical cases, they focus on individual cases.
Invariance rule. Certain factors should be given or deemed as 0. 20 % fat or 80 % fat-free.
We focus intently and narrowly on the problem at hand.
People giving decisions now not thinking about further decisions in the future. What are they going to do then, consider; but they don't.
There are failures of objectivity. We think that the reasoning goes from premises to conclusions. Directional. There are certain things you assume and arrive at conclusion from those assumptions. Influences go another way. People believe in arguments because they believe in conclusions. Characteristic failures of rationality. Perfect rationality.
Two agents, system1 and system2. System 1 is quick, intuitive and system 2 is slow. Class behaviour.
Endowing agents with propensities or traits, easy to remember.
System 2 is slow. Engages in activities that demand effort. Pupils dilate. Heartbeat increase. Type 2 activities; when people exert effort then that's type 2. When you make a left turn, you stop talking. They can't do other things, then type 2. Effortful activities. Effort. Limited capacity. Effortful activities are my activities. Focusing intently on one point, being kind to someone you don't love. Effortful. When our minds think it's effortful.
System 1, memory. You don't do them, they happen to you. They evoke memory. You can't help, those things just happen.
You had WWI happened automatically.
Upper-class British accent, "I have large tools on my back?" Brain surprised. Stereotype, incongruity and surprise. Detection under half a second. You don't have to think about it; it just happens to you.
System 1 is not dumb, although system 2 requires some level of thinking.
What do we do really well is system1. Skills are from system1. Intuitive skills.
Our mind happens passively in system1.
The reporter is system1, the editor is system2. Endorse system 1, that's what system 2 does. Vague impressions become beliefs. Vague tendencies become decisions. System 2 is lazy.
A and B cost 1.10 $. A cost 1 $ more than B. How much is B? Most people think it's 10 cents.
S2 does as little as possible. By large most things come from S1. Proposing, suggesting, impression, beliefs.
How the mind works? What are the operating rules for S1? Heuristic. Does it work?
Even if S2 changes the story, S1's story is there. Characteristics of S1, which makes the failure of perfect rationality. S1 is a good storyteller. It's perfect rationality. S1 is a good storyteller. It's a machine. Looks for connections. It does it perfectly. The fact is the market went up or down. The mind looks for an explanation. Has to be a potential event that happened earlier and sufficiently surprising to be the cause. We tend to tell stories. S1 tells the best possible story, that is coherent and consistent. Hitler likes children, we don't like him but it's correct.
Associative coherent story. Bothers us.
Edit on 7th July 2021, Wed. Started reading Daniel Kahneman's "Thinking, fast and slow" book. I need to finish the first 50 pages of the book by this weekend. So, I will be adding some notes of mine here about the things that I have read between pages 1 and 50.
Contents.
Introduction.
Part I. Two systems.
1. Characters of the story.
2. Attention and effort.
3. The lazy controller.
4. The associative machine.
5. Cognitive ease.
6. Norms, surprises, and causes.
7. A machine jumping to conclusions. (Let me guess it here; the author most probably talking about human beings and our inability to keep cool and wait until all data is gathered. We are jumping too early to final decisions.)
8. How judgments happen.
9. Answering an easier question.
Part II. Heuristics and biases.
10. The law of small numbers.
11. Anchors.
12. The science of availability.
13. Availability, emotion and risk.
14. Tom W's speciality.
15. Linda: less is more.
16. Causes Trump statistics.
17. Regression to the mean.
18. Taming intuitive predictions.
Part III. Overconfidence.
19. The illusion of understanding.
20. The illusion of validity.
21. Intuitions vs formulas.
22. Expert intuition: when can we trust it?
23. The outside view.
24. The engine of capitalism.
Part IV. Choices.
25. Bernoulli's errors.
26. Prospect theory.
27. The endowment effect.
28. Bad events.
29. The fourfold pattern.
30. Rare events.
31. Risk policies.
32. Keeping score.
33. Reversals.
34. Frames and reality.
Part V. Two selves.
35. Two selves.
36. Life as a story.
37. Experienced well-being.
38. Thinking about life.
Conclusions.
Appendix A: judgment under certainty.
Appendix B: choices, values and frames.
Acknowledgements.
Notes
Index.
Introduction (pages 7-18)
The author writes that his purpose in writing this book is to improve people's vocabulary on judgments and choices of others, etc. and he has chosen the gossip as the style of the book; since he says it is much easier and fun to identify and label the mistakes of others. :) Author says questioning ourselves is difficult, but we can use the opinion of others.
Systematic errors or biases occur frequently and we can identify them in some patterns. For instance, a confident public speaker or a beautiful model girl get more appreciation than their peers.
There is a constant impression, short analyses are going on in our heads. Most of the time, we act accordingly. We sometimes let our feelings guide our decisions and even if the outcome is wrong or the result that we didn't expect at the beginning, we continue to trust our own decisions. An objective observer will notice our errors easily. I think this is one of the reasons why the author has chosen the style of gossip in this book.
Origins (pages 8-14)
Here, the author talks about how he met Amos Tversky, to whom he also dedicates this book, I guess; since, at the beginning of the book writes: "In memory of Amos Tversky." At the time, Amos was seeking an answer for the research of UMich (University of Michigan) on human statistics. In the beginning, Amos was optimistic about human intuition; however, when they gather and use their experience, hence, simple decisions, statistics etc. on basic problems. They found out that they better need to be pessimistic about human decision-making skills because they were inaccurate despite the years of practice. They realised that they believe in insufficient data more easily and don't collect more data and do a lot more observations.
Kahneman notes that working along with Tversky was funny, "it is much easier to strive for perfection when you are never bored." They both questioned each other and analysed their answers. They discovered that human beings answer intuitively, even if it is a wrong answer, they continue to stick to that, generally. They used to predict the children's future professions; and there was no logical connection, only appealing ones, like surrounding, stereotypes, resemblance etc. As a teacher, I never fully know what I would do in the future. I wasn't expecting to teach English, the job I'm doing now. And I never know what will happen in the future; I can just predict it. When I cannot correctly predict my own future, even to the slightest degree, how come we predict other's futures? That's a difficult question, but the answer is obvious, I think - we can't, even if love to do so, we can't.
People were given a sample person, his characteristics; and that person would be questioned about the future job of that sample. And there you are, we will reach our final decisions based on the surroundings, etc. because they are appealing to us. We love to make judgments without sufficient prior knowledge. We don't look at other useful statistics, like shortage of some professions, some others are present everywhere etc. There is another thing that adds up to our error, that's the ease of memory search. We don't want to fatigue our brain when we are trying to recall something. Here, they used the first letter vs third letter words; participants were given a letter and asked to come up with the word that has the given letter either at the beginning or at the third position. I think I don't need to tell you about the results since you can guess it easily. (See, even here I have the bias, misjudgment.) He thought that politicians break the law more compared to usual citizens; but later on, thinking carefully he finds out that the transgression of politicians is more likely to be reported compared to his subjects. This is also another example of the reliance on the availability heuristic.
I came to realise that Kahneman uses the word "heuristic" a lot. Let's have a look at this word in various dictionaries. Cambridge dictionary online, the definition of "heuristic:/hjʊəˈrɪstɪk/"
(education), adjective; (of a method of teaching) allowing students to learn by discovering things themselves and learning from their own experiences rather than telling them things;
(business English), noun; a method of learning or solving problems that allow people to discover things themselves and learn from their own experiences.
During the 70s, people or scientists let's say, used to believe that humans have rational thinking skills; and they only depart the intelligence when they are under influence of the extreme feelings like anger, fear, love, etc. Daniel and Amos wrote a paper where they defied that popular belief of that time. People give importance to what they can recall easily while neglecting other things. Thus, the authoritarian regimes don't want media or let's say independent media. If something continuously pops up in the viewers' attention, then they are going to prioritise that thing. Equally important other things could be neglected if enough attention is not paid, by the media or the people themselves. (left at page 12) The author suggests we ignore the relevant statistical fact because it is just an incidental detail and may hinder us to arrive at sound conclusions.
Their research got some criticism, as well. It helped them to better their findings. Eventually, their work made a big impact on the social sciences area.
After their work on how people judge, they moved on to how people decide, especially under uncertainty. They were allowed to gamble; you win 130 $ if heads come, you lose 100 $ if tails come. Again, intuitive feelings or gut feelings blocked the rational decision mechanism and let people give biased decisions. "Prospect theory: an analysis of decision under risk," a theory of choice is their work and also one of the fundamental theories in behavioural economics. Amos Tversky (would have gotten the prize had he not died in 1996) and Daniel Kahneman (and some others maybe) gets Nobel Prize in 2002.
Where are we now (pages 14-16)
To present how the mind works. There are a lot of flaws in intuitive thought. Even the experts may look like they are giving professional decisions, but in fact, they get to better decisions because of their plenty of experience. We see many examples of this expert intuition in real life; sometimes, the worker may see that something is going wrong and may save lives. Even our own daily experiences show that we have developed a lot of intuition; who is angry, what is dangerous, etc. Herbert Simon, after studying a lot of chess masters, says that "the situation has provided a cue; this cue has given the expert access to information stored in memory, and the information provides the answer. Intuition is nothing more or less than recognition." People develop valid intuition when they see the familiar structure and recall the best way to react. Even professionals make gut decisions from time to time like going all into some company for investment. When we face difficult questions where there is no easy solution present, we go for alternatives; like alternative questions, "do I like this company?" The answer to that question is easy yes or no and based on that answer that investor invested. That is the intuitive heuristics itself.
When we can't find either solution or heuristic answer we find ourselves in deliberation. System 1 refers to fast thinking, be it intuitive thought, both heuristic and the expert, and automatic perception or memory. System 2 refers to slow thinking.
What comes next (pages 16 - 19)
A book consisting of 5 parts; 1 presents the fundamental elements of systems, 1 and 2. Part 2 asks the question - why is it so difficult for us to think statistically? And those difficulties of statistical thinking form part 3; our overconfidence in what we know, our inability to recognize our ignorance. We underestimate the chance factor in the events. Apparently, the author was influenced by Nassim Taleb and his book "The black swan." (I think we should read it, too) Part 4 is economics and decision making. Part 5 is about two selves, the experiencing and remembering selves of a person. People automatically check system 1 to get an answer, if they recall their past, especially the bad experience, then we again put ourselves under unnecessary pain. However, we don't feel as happy when we recall those moments of joy later on. That is an interesting question to deal with. Automatic system 1 and effortful system 2.
Part I - Two systems (pages 19 - 105)
The characters of the story (pages 21 - 32)
Figure 1 (pages 21 - 22)
Multiplication effortful. Looking at the face of an angry woman, easy, automatic and intuitive.
Two systems (pages 22 - 26)
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. We share system 1 skills with some other animals, as well. It can get better over time, like finding a better chess move for chess masters; or it can come innate-like recognizing the social nuances. In the expertise, the knowledge is stored in the memory and later accessed when faced with similar situations. You can't calculate the difficult multiplication and do a left turn in traffic; it overuses the attention sources in the brain.
I remember once in a job interview, an eastern European company was opening its branch in Turkey, and in that interview, they criticised me for not being able to multi-task. And that man was so proud that he could multi-task, at least that was the impression he had on me. I hate that company, I hate those jerks. I prepared an e-commerce report about Turkey and sent them, I got no reply. They didn't inform me if I was accepted to the job or not; they even didn't thank me for the report. Nothing. They are total garbage.
When we are doing System 2, sometimes we may look blind to other things; we may only focus on one thing alone.
Plot synopsis (pages 26 - 27)
System 1 feeds system 2, and that's fine, usually. S2 is automatically activated when S1 cannot find an answer. When we see something unusual it may get our attention if we are surprised by the result of it, thus S2 gets activated. S2 also monitors our own behaviour; polite behaviour when we are angry, etc. System 1 is good at fast predictions, etc. It has some biases, as well, the systematic errors in particular circumstances. It doesn't have statistical knowledge or logic; you can't turn it off as well. When you are shown a word in the language you know well, you are going to read it, involuntarily.
Conflict (page 27)
Figure 2 (pages 27-28)
System 2 is in charge of self-control, it tries to overcome the impulses of System 1.
Illusions (page 28)
Figure 3 (pages 29-30)
We must learn not to trust our impressions, sometimes. Not all illusions are visual; there are illusions of thought called cognitive illusions. We are not taught to distrust our feelings. On the other hand, continuous vigilance consumes too much time and energy, it is inefficient. The best possible way is to recognize the patterns that humans make mistakes and try to avoid falling for that trap again, especially when the stakes are high.
Useful fictions (pages 30-31)
When we are doing some activities in System 2 our pupils dilate and our heart rate increases.
Attention and effort (pages 33 - 39)
Mental effort (pages 33 - 39)
Eckhard Hess' eyes dilate when he looks at the same woman, but more beautiful in one picture, and it constricts while looking at another one. Buyers sometimes wear dark glasses to hide their interest from the merchants; this arises a question, is this the same reason the US police wear black sunglasses? Hess finds that our pupils dilate when we face some effortful task. The peak of pupils coincides with the maximum effort. In the experiment carried out by Kahneman and another student, when they asked too difficult tasks for the subjects, their pupils stopped dilating and actually shrank. System 1 takes control in emergency situations.
The law of least effort says that if there are multiple solutions to a problem, most people will gravitate towards the one with the least effort.
Prefrontal area of the brain that deals with the operations that require intelligence. It is much better developed in humans than other primates. (continue from page 39)
He gives the example of add-3; for instance, keep a number in your mind, say 1234; add 3 to every digit, say that number. That requires a lot of effort. Looks like slow thinking, because System 2 is involved, but in fact, our brain thinks very fast. It is like a juggler with several balls in the air. Storing 6 or 7 digits in our mind is effortful alike.
The lazy controller (pages 41 - 51)
We can walk and think, we can do pleasantries with people and still do little other activities which requires less effort; however, when you ask someone to do a difficult multiplication while walking that person almost stops. On the other hand, if a person increases walking speed then his full attention is drawn to what he is doing at that moment - walking fast or running. A person needs to resist the urge of slowing down. Self-control and deliberate thought apparently draw on the same limited budget of effort.
State of effortless attending is called flow; in other words a state of effortless concentration so deep that people lose their sense of time, of themselves, of their problems, they say. I think it looks like modern-day video game playing or playing chess.
The busy and depleted system 2 (pages 42 - 45)
People are more likely to yield to temptation when they are simultaneously challenged with mentally effortful tasks and a temptation. When System 2 is busy System 1 controls your behaviour and it is more likely that a busy person will engage in eating something sweet; that busy person is more likely to act hedonistic in that situation. The same applies to people who drink alcohol or are sleepless. Controlling behaviour and thoughts are one of the tasks of System 2. People were given successive tasks, mind depleting tasks; first shown emotional movie and asked to hide their emotions, and then they were asked to perform a physical activity; they performed poorly in the latter. Ego-depletion. Another example is that people were offered sweet foods and healthy ones, they were asked to eat healthy ones; later, they were asked to do the cognitive activity; they fared poorly. When we are tired and hungry we are more likely to fail the activities we were given. The judges approved the parole at higher rates just after the meal breaks.
The lazy system 2 (pages 45 - 48)
How closely does system 2 monitor the suggestions of System 1? The bat and ball problem; together cost 1.10 $, the bat is 1 $ more expensive than the ball. How much is the ball? Most people would say 10 cents and that's incorrect. That answer was provided by system 1, and it required a little check by system 2. When we believe that the conclusion is true, we also believe in the supporting arguments; we don't check if they are true or not.
Intelligence, control, rationality (pages 48 - 51)
If people were ranked by their self-control and by their cognitive aptitude, would individuals have similar positions in the two rankings? Walter Mischel carries out an experiment; a child was offered a cookie that he can eat anytime or wait for 15 minutes and eat 2 cookies afterwards. Half of the children couldn't resist the temptation and the other half focused their attention away from the cookies. Later on, in their lives there was a huge gap between them; the ones who managed to wait performed better in intellectual tests; they were less likely to use drugs, etc. System 1 is impulsive and intuitive; system 2 is capable of reasoning, and it is cautious, but at least for some people it is also lazy.
What makes some people more susceptible than others to biases of judgment?
The associative machine (pages 52 - 60)
Associative activation. Bananas vomit. The brain triggers many associated ideas as a result of system 1. Associatively coherent. (continue from page 53)
Not only do our brains react to sth negative, but also our bodies show a reaction, too. David Hume says, in his "An enquiry concerning human understanding," there are 3 principles of association: resemblance, contiguity in time and place, and causality. Psychologists say ideas are linked to one another, like nodes in a vast network. We are thinking constantly; and only a few of them is conscious, while most are unconscious. We know less about even ourselves.
The marvels of priming (pages 54 - 56)
The priming effect is what comes to our mind first when we are exposed to those things or associated stuff more often than others. Psychologist John Bargh made an experiment at NYU; he asked students to construct sentences from given words. Later on, they were asked to walk the hallway; the group which chose elderly words walked slowly. Florida effect; first show words associated with old age but never show the word "old" itself, and then make participants do some mechanical activity, like walking. Participants said that they weren't affected by the words; in fact, they claim that they didn't notice the elderly topic; because all these happen subconsciously and later on it affects their mentality and body, as well. It is also known as the ideomotor effect - influencing action by the idea. If that participant dislikes the elderly, then the influence is just the opposite; he will not be slow, instead, he will act fast. Interestingly, this ideometer effect works in reverse, too. For instance, at a German university, students were asked to walk slowly; first machine activity. And then they were offered the words; now they noticed the elderly words more easily. Put a pencil in your mouth, smiling position; it amuses people. Students were asked to rate the humour of cartoons; the ones who were in the "smiling" position were more likely to find the cartoons funnier. In another experiment; half of the participants were asked to nod and the other half was to shake. The people who nodded (gesture for yes) accepted hearing the message and others (shake - a gesture for no) rejected. They weren't aware of it. A habitual connection between an attitude of rejection or acceptance and its common physical expression. Act calm and kind regardless of how you feel.
Primes that guide us (pages 56 - 59)
The priming effect influences our choices. Money affects it badly; people who were shown pecuniary things were having a difficult time-solving problems; they were also more selfish, and less helpful for others. Societies may be shaped by the surroundings; money, leader, "big brother is watching," etc. Lady Macbeth effect; wish for cleaning a "stain" in the body after doing some bad. System 2 believes that it is in charge but in fact, not. People are left in disbelief when they are told about the findings of these experiments. Images of flowers and eyes were exchanged in a place where workers asked to leave a tip; in the eye images, they left more tips. System 1 is subconscious; it provides impressions that turn into beliefs in the long run. Our actions and choices are the results of system 1.
Cognitive ease (pages 61 - 71)
Cognitive ease, for now, no need for System 2, System 1 will deal with it.
Illusions of remembering (pages 62 - 63)
Sense of ease gives the impression of familiarity; the words we have seen previously are easier to read next time.
Illusions of truth (pages 63 - 64)
Familiarity creates cognitive ease and it may sometimes create a bias. Repetition may lead something to be disguised as truth.
How to write a persuasive message (pages 64 - 66)
If you want people to believe in your message, then reduce cognitive strain, write legibly. Use simple language, avoid complexity. To make it memorable, verse it. People liked rhythmic aphorisms more than when they don't rhyme. System 2 is lazy. We should pay attention to the illusion of truth. Most of the time system 2 adopts the suggestion or impression of system 1.
Strain and effort (pages 66 - 67)
Cognitive strain mobilizes system 2 and this may sometimes reject the intuitive answer of system 1.
The pleasure of cognitive ease (pages 67 - 69)
Mind at ease puts a smile on the face. Cognitive ease makes people happy, it is associated with good things. Easily pronounced words evoke a favourable attitude; the pictures with easily recognizable contours make people smile; the companies that have easier names to pronounce do better at the beginning in the stock market, though effect it neglected over time. Repetition induces cognitive ease and a comforting feeling of familiarity. There was an experiment conducted; Robert Zajonc calls it the "mere exposure effect;" in UMich and Mich State Uni; a lot of words appeared in the newspapers, and the attendees were asked to rate the words on the scale from "good" to "bad." Students voted the words that appeared a lot as "good" words and vice versa. This effect is not about consciousness; because students who have seen the words did not notice them at all. But still, it created some kind of familiarity. This is about System 1, no need for System 2 here. To survive animals need to be alert always, especially for novelty. If something bad doesn't happen after seeing that novelty, then people associate that with comfort. It is a safety signal for humans, and safety feels good.
Ease, mood and intuition (pages 69 - 71)
Sarnoff Mednick did RAT (remote association test) and gave participants 3 words and asked them to come up with a word that was associated with all 3 words. It turns out that when the participants' mood was high, so their scores, too, by twofold, at least. And when their mood was bad, their answers were no better than the bling guesses. Mood affects System 1; when we are unhappy we lose our touch with intuition. It also adds to our creativity. However, in a happy mood, people become more intuitive but less vigilant and more prone to logical errors. It is evident that in a good mood, our body thinks that the environment is safe and lets its system go easy.
Assessing normality (pages 72 - 75)
There are 2 surprises; active and passive. If our spouse comes home and she starts talking and if her voice is different, or some other thing is different then we get surprised; this is an active and conscious surprise. Another surprise, passive one, is that when we meet our childhood friend after long years, we get surprised. However, if we see him again, later in the airport, we don't get surprised; we are used to him. Our System 1 says it is ok to meet him in strange places. Now it is normal. For instance, a lot of forests are burning in the last few years. In the beginning, it was a total surprise; but now, some people are sadly accustomed to it; now it became (or tries to become) normal. Or the covid situation. Everyone was afraid at the beginning, but after a few months, some people almost don't care about it at all. If they were caring they would've been vaccinated. The situation is also called "norm theory." Moses illusion is that "how many animals of each kind did Moses take into the ark?" It looks normal because Moses is a biblical name; however, Noah took the animals into the ark, not Moses. Our brain says ok because both names are in the biblical context and the question is about religion.
Seeing causes and intentions (pages 75 - 78)
We have causality or a sequence of events from birth. They don't depend on pattern reasons, but rather they are products of System 1.
A machine for jumping to conclusions. (pages 79 - 88)
System 1 is prone to jumping to conclusions. ABC and 121314, when shown the image, B and 13 look alike, but according to the context "System 1" bets on the best answer; and it is guided by experience and the most recent memory. System 1 rejects the alternatives; it doesn't keep track of them. Conscious doubt is not in the repertoire of System 1; it is in System 2 because it requires mental effort.
A bias to believe and confirm (pages 80 - 81)
Psychologist Daniel Gilbert writes in his essay, "how mental systems believe," about a theory of believing and unbelieving; which also goes back to XVII century philosopher Baruch Spinoza. In order to believe something, first, people check if that statement is true or not. Our first attempt is usually on believing because System 1 is gullible; doubt is not in the domain of it; System 2 can doubt. In one part of the experiment, the participants were asked to hold a certain number of digits in their mind; and in that experiment, it was found out that participants couldn't identify false sentences as "unbelievable" because System 2 was busy with remembering the numbers. There is also evidence that people are more likely to believe in empty persuasive messages, such as commercials, when they are tired.
Exaggerated emotional coherence (halo effect) (pages 81 - 84)
The tendency to like or dislike everything about a person is known as the halo effect. You meet a person named Joan in a bar, and you liked her; she was good, friendly, etc. And then you were asked if she could contribute to a charity. Even though you know virtually nothing about her generosity, you are more inclined to think that she will donate; because by the association, you are predisposed to believe that Joan is generous. Real evidence is missing; the gap is filled by our emotion attached to the first impression. Consider this;
Alan: intelligent, industrious, impulsive, critical, stubborn, envious
Ben: envious, stubborn, critical, impulsive, industrious, intelligent
Even though the same adjectives of personality were written on both candidates, most people are more prone to like Alan over Ben because of the halo effect of the first impressions. Stubbornness and envy of an intelligent person are more favoured than the intelligence of a stubborn and envious person. The author gives an example of grading from his life; he realised that he was grading student booklets on a homogeneous basis. There were 2 essays, and if the first essay got the top grade then the second one is also more likely to receive a higher grade due to the halo effect. However, the professor changed his style; instead of grading all essays sequentially, he started to grade only the first essays, writing down the grade it received; and then moving onto the second essay. Now, Prof. Kahneman found out that sometimes there was a discrepancy between the two; and he claims that he had a temptation to close the gap between that grade discrepancy. Moreover, it was difficult for him not to yield to that temptation; and his confidence in grading also decreased because this was a novelty for him. In the previous method, System 2 was lazily accepting the biased final grades. In his book, The wisdom of crowds, James Surowiecky writes about group decisions. A group of people were shown a jar containing coins; they were asked to estimate the coins. When they estimated independently, the average of the group was almost correct. Some may think it was low, while others think it was high. However, when they shared their estimate together, the first errors influenced others; thus decreasing the size of the sample and with it the accuracy of the group estimate. This would also be useful in group meetings. What usually happens is that the ones who speak early and assertively affect others. It is best to have everyone write down their propositions before the meeting has begun.
What you see is all there is (wysiati) (pages 84 - 88)
When information is scarce, which is a common occurrence, System 1 operates as a machine jumping to conclusions. "Will John be a good leader? He is intelligent and strong..." A common answer is yes. What if the following adjectives were corrupt and cruel? You didn't start by asking "what would I need to know before I formed an opinion about the quality of someone's leadership?" System 1 created a story; intelligent and strong are good adjectives, then he is a good leader. Even if a piece of new information is added on, for instance, "John is corrupt," the first impression will still be biased. The combination of coherence-seeking System 1 and lazy System 2 indicates that System 2 will endorse many intuitive beliefs and impressions of System 1. However careful one is, System 1 is likely to influence the decisions one make. Its input never ceases. Amos did research; there was a case, what is usually expected is that people who listen to only one side can also empathise with the other, as well. However, the results were astonishing; people who listened to only one side favoured that side over the other and they were confident of their judgments. People find out that the consistency of the story matters more than the completeness of it.
How judgments happen (pages 89 - 96)
Basic assessments (pages 90 - 92)
People vote for a candidate's facial look of competence. Winners have a certain number of positive attitudes while losers facial expressions have a negative one - judgment heuristic.
People were asked about their willingness to pay to save drowning birds, 2 000, 20 000, 200 000; and volunteers stated that they would pay $80, $78 and $88 respectively. In an emotional context, people neglect quantity.
Intensity matching (pages 93 - 94)
Mental shotgun (pages 94 - 96)
Answering an easier question (pages 97 - 105)
Substituting questions (pages 97 - 99)
When we cannot answer a difficult question, System 1 finds an easier question, answers it, and then makes us answer that difficult question, even if the answer may not be acceptable. This is called substitution. A heuristic is when a simple procedure helps find an adequate answer to a difficult question, although that answer is often imperfect.
