Tag: Psychology

3 Ways You’re Wrong in a Disagreement (Even if You’re Right)

Kathryn Schulz, the illuminating author of Being Wrong: Adventures in the Margin of Error, gave an excellent talk at TED talk on being wrong.

There is a moment in her talk when she summarizes what we do when someone disagrees with us that is worth pondering.

The first thing we usually do when someone disagrees with us is that we just assume they are ignorant. You know, they don’t have access to the same information we do and when we generously share that information with them, they are going to see the light and come on over to our team.

When that doesn’t work. When it turns out those people have all the same information and they still don’t agree with us we move onto a second assumption. They’re idiots. They have all the right pieces of the puzzle and they are too moronic to put them together.

And when that doesn’t work. When it turns out that people have all the same facts that we do and they are pretty smart we move onto a third assumption. They know the truth and they are deliberately distorting it for their own malevolent purposes.

So this is a catastrophe: our attachment to our own rightness. It prevents us from preventing mistakes when we need to and causes us to treat each other terribly.

And this is what it’s like to come face to face with someone that disagrees with us.

That point isn’t really whether we’re right and they’re wrong or they’re right and we’re wrong — often neither of us are perfectly correct. The point is how our ego subconsciously works to protect itself from anyone and anything that doesn’t entirely agree with us.

Rather than open ourselves up to how the world works, we instead put on blinders that tell us we don’t need to consider the possibility that the only thing wrong is that we think the other person is wrong and not ourselves.

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    Image via TED

Marshall McLuhan — The Man, The Mystery, The Life

Marshall McLuhan rocketed from an unknown academic to rockstar with the publication of Understanding Media: The Extensions of Man in 1964.

Understanding Media contained the simple prophecy that electronic media of the twentieth century—at the time consisting of telephone, radio, movies, television, but also including newer technologies like the Kindle, the Internet, the iPad—were breaking the traditional limitations of text over our thoughts and senses. Thanks to McLuhan’s ability to turn a phrase, Understanding Media is a work more talked about than read. At the core of the book is a phrase that most have heard: “The medium is the message.”

“What’s been forgotten,” argues author Nicolas Carr in The Shallows, “is that McLuhan was not just acknowledging, and celebrating, the transformative power of new communication technology. He was also sounding a warning about the threat that power poses—and the risk of being oblivious to that threat.

“The electric technology is within the gates,” McLuhan wrote, “and we are numb, deaf, blind and mute about its encounter with the Gutenberg technology, on and through which the American way of life was formed.”

“McLuhan understood,” Carr continues “that whenever a new medium comes along, people naturally get caught up in the information—the content—it carries.” With new mediums for communications come standard arguments. Enthusiasts praise the new content the technology allows, interpreting new methods as a way to reduce the friction of information sharing. This, they argue, is good for democracy. Skeptics, on the other hand, condemn the content and see any assault against existing mediums as an effort to dumb down our culture.

Both, however, miss McLuhan’s point that in the long run the content of a medium—be it a television, radio, the internet, or even a kindle—matters less than the medium itself in influencing us (whether we realize it or not).

Carr argues “As our window onto the world, and onto ourselves, a popular medium molds what we see and how we see it—eventually, if we use it enough, it changes who we are, as individuals” and collectively as a society.

“The effects of technology do not occur at the level of opinions or concepts,” wrote McLuhan. Rather they “alter patterns of perception steadily and without any resistance.”

In Understanding, McLuhan proffered “A new medium is never an addition to an old one, nor does it leave the old one in peace. It never ceases to oppress the older media until it finds new shapes and positions for them.” We see this today as newspapers transition to a digital world and how the medium—the internet—remakes the papers to fit its own standards. Not only have newspapers moved from physical to virtual but now they are hyperlinked, chunked, and embedded within noise. If he were alive (and healthy) McLuhan would argue these changes impact the way we understand the content.

McLuhan foresaw how all mass media would eventually be used for commercialization and consumerism:  “Once we have surrendered our senses and nervous systems to the private manipulation of those who would try to benefit by taking a lease on our eyes and ears and nerves, we don’t really have any rights left.”

* * *

Here is a clip from a 1968 CBC show featuring a popular debate between Norman Mailer and McLuhan.

Before you decide if McLuhan was a genius or crackpot you should know that McLuhan suffered from a few cerebral traumas—including multiple strokes. One stroke was so bad he was given his last rites. Only a few months before the debate with Mailer, a tumor the size of an apple was removed from his brain. McLuhan’s stardom—and some argue his mind—started fading shortly after this video.

* * *

Perhaps nothing demonstrates McLuhan’s brilliance as well as his craziness as this 1969 interview with playboy. In the excerpt below, McLuhan describes his vision of cloud computing—he was well ahead of his time, keep in mind we’re talking 1969. Carr sums up this interview brilliantly: As is typical of McLuhan, there’s brilliance here, but there’s also a whole lot of bad craziness. At least I hope it’s bad craziness.

MCLUHAN: Automation and cybernation can play an essential role in smoothing the transition to the new society.


MCLUHAN: The computer can be used to direct a network of global thermostats to pattern life in ways that will optimize human awareness. Already, it’s technologically feasible to employ the computer to program societies in beneficial ways.

PLAYBOY: How do you program an entire society – beneficially or otherwise?

MCLUHAN: There’s nothing at all difficult about putting computers in the position where they will be able to conduct carefully orchestrated programing of the sensory life of whole populations. I know it sounds rather science-fictional, but if you understood cybernetics you’d realize we could do it today. The computer could program the media to determine the given messages a people should hear in terms of their over-all needs, creating a total media experience absorbed and patterned by all the senses. We could program five hours less of TV in Italy to promote the reading of newspapers during an election, or lay on an additional 25 hours of TV in Venezuela to cool down the tribal temperature raised by radio the preceding month. By such orchestrated interplay of all media, whole cultures could now be programed in order to improve and stabilize their emotional climate, just as we are beginning to learn how to maintain equilibrium among the world’s competing economies [ha! -Rough Type].

PLAYBOY: How does such environmental programing, however enlightened in intent, differ from Pavlovian brainwashing?

MCLUHAN: Your question reflects the usual panic of people confronted with unexplored technologies. I’m not saying such panic isn’t justified, or that such environmental programing couldn’t be brainwashing, or far worse – merely that such reactions are useless and distracting. Though I think the programing of societies could actually be conducted quite constructively and humanistically, I don’t want to be in the position of a Hiroshima physicist extolling the potential of nuclear energy in the first days of August 1945. But an understanding of media’s effects constitutes a civil defense against media fallout.

The alarm of so many people, however, at the prospect of corporate programing’s creation of a complete service environment on this planet is rather like fearing that a municipal lighting system will deprive the individual of the right to adjust each light to his own favorite level of intensity. Computer technology can – and doubtless will – program entire environments to fulfill the social needs and sensory preferences of communities and nations. The content of that programing, however, depends on the nature of future societies – but that is in our own hands.

PLAYBOY: Is it really in our hands – or, by seeming to advocate the use of computers to manipulate the future of entire cultures, aren’t you actually encouraging man to abdicate control over his destiny?

MCLUHAN: First of all – and I’m sorry to have to repeat this disclaimer – I’m not advocating anything; I’m merely probing and predicting trends. Even if I opposed them or thought them disastrous, I couldn’t stop them, so why waste my time lamenting? As Carlyle said of author Margaret Fuller after she remarked, “I accept the Universe”: “She’d better.” I see no possibility of a worldwide Luddite rebellion that will smash all machinery to bits, so we might as well sit back and see what is happening and what will happen to us in a cybernetic world. Resenting a new technology will not halt its progress.

The point to remember here is that whenever we use or perceive any technological extension of ourselves, we necessarily embrace it. Whenever we watch a TV screen or read a book, we are absorbing these extensions of ourselves into our individual system and experiencing an automatic “closure” or displacement of perception; we can’t escape this perpetual embrace of our daily technology unless we escape the technology itself and flee to a hermit’s cave. By consistently embracing all these technologies, we inevitably relate ourselves to them as servomechanisms. Thus, in order to make use of them at all, we must serve them as we do gods. The Eskimo is a servomechanism of his kayak, the cowboy of his horse, the businessman of his clock, the cyberneticist – and soon the entire world – of his computer. In other words, to the spoils belongs the victor …

The machine world reciprocates man’s devotion by rewarding him with goods and services and bounty. Man’s relationship with his machinery is thus inherently symbiotic. This has always been the case; it’s only in the electric age that man has an opportunity to recognize this marriage to his own technology. Electric technology is a qualitative extension of this age-old man-machine relationship; 20th Century man’s relationship to the computer is not by nature very different from prehistoric man’s relationship to his boat or to his wheel – with the important difference that all previous technologies or extensions of man were partial and fragmentary, whereas the electric is total and inclusive. Now man is beginning to wear his brain outside his skull and his nerves outside his skin; new technology breeds new man. A recent cartoon portrayed a little boy telling his nonplused mother: “I’m going to be a computer when I grow up.” Humor is often prophecy.

Understanding Media: The Extensions of Man is worth the read.

If you’re interested in learning more about McLuhan, check out the McLuhan project (http://www.abc.net.au/rn/mcluhan/). Read The Shallows: What the Internet is Doing to Our Brains to find out how the Internet is changing us.

Jeffrey Pfeffer: Why Performance Won’t Get You Promoted

power why some people have it

If you’re going to play the game you should at least educate yourself on the unwritten rules. In an NPR interview (audio below), Stanford business professor Jeffrey Pfeffer highlights why performance won’t get you promoted and why power is corrupting.

Here are my notes on the audio interview:
1. performance is elusive and thus can be shaped and managed;
2. you can do your job too well;
3. the world doesn’t work the way you want it to – the way to change it is to go out and make something happen;
4. power corrupts — when you attain power you don’t think you have to follow the rules anymore;
5. when you’re in a position of power everyone is trying to curry your favor and you end up surrounded by sycophants;
6. power can be converted into money;
7. power gives you control over your work (time and pace);
8. you need power to get things done;
9. the more powerful you are the less people will be willing to forgive you;
10. influence is power in use and
11. you can have power or autonomy but not both.

Some of you might be sceptical of Pfeffer’s tactics; but he points out, that if the ends don’t justify the means then what does?

My favorite part of the interview was the quote from a newsman saying: if you don’t like today’s news, go out and make some of your own.

According to Pfeffer’s book Power: Why Some People Have It And Others Don’t, there are seven personal qualities that help to build power: ambition, energy, focus, self-knowledge, confidence, empathy with others, and capacity to tolerate conflict. Intelligence and high performance didn’t make the cut.

The book recommends a few simple steps you can take to increase your power:
1. be visible;
2. emphasize the aspects you’re good at;
3. make those in power feel good about themselves;
4. if you must point out a mistake by someone in power, blame the situation or others; and
5. shower those above with flattery.

If you’re really into power read The Prince

The Mask of Sanity

Snakes in Suits — When Psychopaths Go to Work

Last week I picked up a copy of Snakes in Suits: When Psychopaths Go to Work and found myself quickly immersed.

On the surface psychopaths appear normal, sane, and in control; in fact, many are quite likable. However, as The Mask of Sanity puts it, “the psychopath presents a technical appearance of sanity, often one of high intellectual capacities and not infrequently succeeds in business or professional activities.” So, in short, they are hard to identify. Even professional Psychiatrists have been duped.

Psychopaths do naturally what some politicians, salesmen, and promoters have to work hard to achieve: impress listeners with how they say something.

Understanding how psychopaths manipulate others is key to improving the odds you won’t get duped in the future.

While the specific details of each case may differ, the feelings, attitudes, behaviors, ad outcomes the victims described seemed to form a patter or process.

The general understanding of the process, roughly in the order they seem to appear: temptation (your curiosity goes up and your guard goes down), bonding (you believe you’ve found the perfect relationship), collusion (wanting to please them, you give in to their expectations and demands), self-doubt (you blame yourself for their unhappiness), abuse (you take what they dish out), realization (you see that you have been played the fool), shame (you feel too embarrassed to tell others or seek help), anger and vindication (you want to get even; you repair the damage done).

So are Psychopaths the result of nature or nurture? The book explains:

As with most other things human, the answer is that both are involved. A better question is “To what extent do nature and nurture influence the development of the traits that define psychopathy? The answer to this question is becoming much clearer with the application of behavioral genetics to the study of personality traits and behavioral dispositions. Several recent twin studies provide convincing evidence that genetic factors play at least as important a role in the development of the core features of psychopathy as to environmental ones.

Still curious? Try reading Snakes in Suits, Power Freaks, Without Conscience, and The Mask of Sanity.


The Ikea Effect: Why Doing Things Ourselves Makes us Happier

The IKEA effect is a super-interesting part of our psychological wiring that has all sorts of implications.

In short, basically, people who voluntarily undergo a great deal of pain, discomfort, or effort to get something will be happier than if it came to them easily.

IKEA uses this to their advantage. So did Betty Crocker, who always required that you at least add one ingredient to her cake mixes. And, interestingly, perhaps this is why we consume so many calories. What if we get less pleasure from food that’s prepared for us, so we eat more of it. When we cook at home, we get more pleasure and not only do we eat healthier but we get more pleasure.

Not only does “assemble yourself” furniture save IKEA money and increase efficiency, but you value that Billy Bookcase even more because you had to put it together.

The IKEA effect is simple: when you work for something you fall in love with it.

Dan Ariel says:

When marketers do sell you a product, their theory is about preference fit. You like pink and I like orange and I like this a little higher and everyone knows their preference. That’s important. But I think the more important issue is not the preference fit but the investment in the product. Say you like orange and pink. Imagine that in one universe you found shoes that are orange and pink and in other you had to invest five minutes of effort and attention and care to choose the exact shades. What we show is that when you’ve invested into it, you would appreciate them more and you would think about them more. You might talk about them more, you might be more likely to buy them again from the same vendor, your connection would be much higher. It takes very little investment to make something your own. … It’s sometimes surprising how little that is.


Still Curious? Dan Ariely is the best-selling author of The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home and Predictably Irrational, Revised and Expanded Edition: The Hidden Forces That Shape Our Decisions.

Behavioral Economics Reading List

Are you looking for good books to read on Behavioral Economics or Behavioral Psychology? This is a list of my best Behavioral Economics books of all time. If you only want to read a few, check out the first three which will give you a firm introduction to everything you need to know.

Judgement in Managerial Decision Making (awesome)
When faced with a decision, we all believe we’re weighing the facts objectively and making rational, thoughtful decisions. In fact, science tells us that in situations requiring careful judgment, every individual is influenced by his or her own biases to some extent. Drawing on the very latest behavioral decision research this book examines judgment in a variety of managerial contexts and provides important insights that can help you make better managerial decisions.

Influence: The Psychology of Persuasion
Should be required Reading.

Nudge: Improving Decisions about Health, Wealth, and Happiness*
“This book is terrific. It will change the way you think, not only about the world around you and some of its bigger problems, but also about yourself.” -Michael Lewis

Why Smart People Make Big Money Mistakes
Gary Belsky and Thomas Gilovich reveal the psychological forces — the patterns of thinking and decision making — behind seemingly irrational behavior. They explain why so many otherwise savvy people make foolish financial choices: why investors are too quick to sell winning stocks and too slow to sell losing shares, why home sellers leave money on the table and home buyers don’t get the biggest bang for their buck, why borrowers pay too much credit card interest and savers can’t sock away as much as they’d like, and why so many of us can’t control our spending.

Breakdown of Will
Ainslie argues that our responses to the threat of our own inconsistency determine the basic fabric of human culture. He suggests that individuals are more like populations of bargaining agents than like the hierarchical command structures envisaged by cognitive psychologists.

Think Twice: Harnessing the Power of Counterintuition
In Think Twice, Michael Mauboussin shows you how to recognize-and avoid-common mental missteps, including: Misunderstanding cause-and-effect linkages; Aggregating micro-level behavior to predict macro-level behavior; Not considering enough alternative possibilities in making a decision; Relying too much on experts

Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being
Monetary incentives are counter-productive in team environments that succeed in creating a culture of identity that fosters teamwork, where mission understanding and commitment are core to performance.

Animal Spirits: How Human Psychology Drives the Economy, and Why it Matters for Global Capitalism*
Akerlof and Shiller reassert the necessity of an active government role in economic policymaking by recovering the idea of animal spirits, a term John Maynard Keynes used to describe the gloom and despondence that led to the Great Depression and the changing psychology that accompanied recovery. Like Keynes, Akerlof and Shiller know that managing these animal spirits requires the steady hand of government–simply allowing markets to work won’t do it.

Predictably Irrational: the Hidden Forces that Shape our Decisions*
Ariely explains how expectations, emotions, social norms, and other invisible, seemingly illogical forces skew our reasoning abilities. Not only do we make astonishingly simple mistakes every day, but we make the same types of mistakes. We consistently overpay, underestimate, and procrastinate. We fail to understand the profound effects of our emotions on what we want, and we overvalue what we already own.

Rational Decisions
A concise, accessible, and expert view on Bayesian decision making.

The Irresistible Pull of Irrational Behaviour
What makes people act irrationally? This book explores the submerged mental drives that undermine rational action, from the desire to avoid loss to a failure to consider all the evidence or to perceive a person or situation beyond the initial impression and the reluctance to alter a plan that isn’t working.

Advances in Behavioral Economics
Advances in Behavioral Economics will serve as the definitive one-volume resource for those who want to familiarize themselves with the new field or keep up-to-date with the latest developments.

Behavioral GameTheory: Experiments in Strategic Interaction
Colin Camerer, one of the field’s leading figures, uses psychological principles and hundreds of experiments to develop mathematical theories of reciprocity, limited strategizing, and learning, which help predict what real people and companies do in strategic situations. Unifying a wealth of information from ongoing studies in strategic behavior, he takes the experimental science of behavioral economics a major step forward.

Behavioral Economics and its Applications
In this volume, some of the world’s leading thinkers in behavioral economics and general economic theory make the case for a much greater use of behavioral ideas in six fields where these ideas have already proved useful but have not yet been fully incorporated–public economics, development, law and economics, health, wage determination, and organizational economics.

Explaining Social Behavior: More Nuts and Bolts for the Social Sciences
Jon Elster offers an overview of key explanatory mechanisms in the social sciences, relying on hundreds of examples and drawing on a large variety of sources-psychology, behavioral economics, biology, political science, historical writings, philosophy and fiction.

Ulysses and the Sirens: Studies in Rationality and Irrationality
Elster critiques the notion of rationality in the economist’s sense, as a faculty that is concerned with maximizing the satisfaction of agents’ present preferences. He contrasts this notion of locally maximizing rationality with what can be called globally maximizing rationality. This latter concept is perhaps best illustrated by those interesting situations where the best “strategy” is irrationality.

Behavioural Finance
William Forbes lays out the fundamentals of behavioral finance.

The Psychology of Investing
Traditional finance has focused on developing the tools that investors use to optimize expected return and risk. Understanding the motivations behind this behavior is extremely important when applying these financial tools.

Beyond Greed and Fear: Understanding Behavioral Finance and the Psychology of Investing
An entertaining, yet scholarly overview of the subject.

Economics and Psychology: A Promising New Cross-Disciplinary Field
The essays in Economics and Psychology take a broad view of the interface between these two disciplines, going beyond the usual focus on “behavioral economics.” As documented in this volume, the influence of psychology on economics has been responsible for a view of human behavior that calls into question the assumption of complete rationality (and raises the possibility of altruistic acts), the acceptance of experiments as a valid method of economic research, and the idea that utility or well-being can be measured.

Irrational Exuberence*
A cult-classic at the time it was written.

An Introduction to Behaviorial Economics
…a superb introduction to the field of behavioral economics, suitable not only as an introductory text, but also as an entry-point for those desiring an engaging overview of the field.

Moral Markets : the Critical Role of Values in the Economy
This collection of essays provides an accessible guided tour of the frontier of current research in sociology, economics, biology and philosophy.

The Paradox of Choice: Why More Is Less
…we are faced with far too many choices on a daily basis, providing an illusion of a multitude of options when few honestly different ones actually exist.

More Than You Know: Finding Financial Wisdom in Unconventional Places
A must read.

The Little Book of Behavioral Investing: How not to be your own worst enemy
…will enable you to identify and eliminate behavioral traits that can hinder your investment endeavors and show you how to go about achieving superior returns in the process.

Morals and Markets: an Evolutionary Account of the Modern World
Economist and evolutionary game theorist Daniel Friedman demonstrates that our moral codes and our market systems-while often in conflict-are really devices evolved to achieve similar ends, and that society functions best when morals and markets are in balance with each other.

Heuristics and Biases: The Psychology of Intuitive Judgement
When are people’s judgments prone to bias, and what is responsible for their biases? This book compiles psychologists’ best attempts to answer these important questions.

Moral Sentiments and Material Interests: the Foundations of Cooperation in Economic Life
“This book presents social science at its interdisciplinary best: an exhilarating mix of game theory, evolutionary biology, experimental economics, cultural anthropology, grammatology, and policy analysis. It will change our views of how biology and culture together determine social behavior.” —Daniel Kahneman

The Bounds of Reason: Game Theory and the Unification of the Behavioral Sciences
Game theory alone cannot fully explain human behavior and should instead complement other key concepts championed by the behavioral disciplines. Herbert Gintis shows that just as game theory without broader social theory is merely technical bravado, so social theory without game theory is a handicapped enterprise.

The Methodology of Experimental Economics
This book provides the first comprehensive analysis and critical discussion of the methodology of experimental economics, written by a philosopher of science with expertise in the field.

The Handbook of Experimental Economics
…presents a comprehensive critical survey of the results and methods of laboratory experiments in economics.

Thinking and Deciding
has established itself as the required text and important reference work for students and scholars of human cognition and rationality.

Judgement Under Uncertainty: Heuristics and Biases
This volume is an important collection of papers, with relevance to anyone working in fields where decision-making is at the core. This is THE book.

Choices, Values, and Frames
…presents an empirical and theoretical challenge to classical utility theory, offering prospect theory as an alternative framework. Extensions and applications to diverse economic phenomena and to studies of consumer behavior are discussed. The book also elaborates on framing effects and other demonstrations that preferences are constructed in context, and it develops new approaches to the standard view of choice-based utility.

The Construction of Preference
When asked to make a decision, people often don’t really know what they want; they must construct their preferences ‘on the spot’. This book describes the concept of preference construction, tracing the blossoming of this idea within psychology, economics, marketing, law, and environmental policy.

Behavioural Finance: Insights into Irrational Minds and Markets
A good introduction.

Value Investing: Tools and Techniques for Intelligent Investment
why everything you learnt at business school is wrong

A Short History of Financial Euphoria
In this small but witty and well-crafted book, Galbraith chronicles the major speculative episodes, from the seventeenth-century tulipmania to the junk-bond follies of the eighties.

Manias, Panics, and Crashes
…an engaging and entertaining account of the way that mismanagement of money and credit has led to financial explosions over the centuries. Covering such topics as the history and anatomy of crises, speculative manias, and the lender of last resort, this book puts the turbulence of the financial world in perspective.

Devil Take the Hindmost: A History of Financial Speculation
A must read.

Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism
Akerlof and Shiller reassert the necessity of an active government role in economic policymaking by recovering the idea of animal spirits, a term John Maynard Keynes used to describe the gloom and despondence that led to the Great Depression and the changing psychology that accompanied recovery. Like Keynes, Akerlof and Shiller know that managing these animal spirits requires the steady hand of government–simply allowing markets to work won’t do it. In rebuilding the case for a more robust, behaviorally informed Keynesianism, they detail the most pervasive effects of animal spirits in contemporary economic life–such as confidence, fear, bad faith, corruption, a concern for fairness, and the stories we tell ourselves about our economic fortunes–and show how Reaganomics, Thatcherism, and the rational expectations revolution failed to account for them.

Discover Your Inner Economist
An engaging narrator, Cowen offers idiosyncratic strategies for appreciating museum art, for building family trust and cooperation, for writing a personal ad, for reading classic novels that seem boring on first inspection, for surviving torture, for properly practicing self-deception and for most effectively giving to beggars in Calcutta.

Additions to the list in 2011

Thinking, Fast and Slow
Kahneman takes us on a groundbreaking tour of the mind and explains the two systems that drive the way we think. System 1 is fast, intuitive, and emotional; System 2 is slower, more deliberative, and more logical. Kahneman exposes the extraordinary capabilities—and also the faults and biases—of fast thinking, and reveals the pervasive influence of intuitive impressions on our thoughts and behavior. The impact of loss aversion and overconfidence on corporate strategies, the difficulties of predicting what will make us happy in the future, the challenges of properly framing risks at work and at home, the profound effect of cognitive biases on everything from playing the stock market to planning the next vacation—each of these can be understood only by knowing how the two systems work together to shape our judgments and decisions.

Everything Is Obvious: *Once You Know the Answer
“Every once in a while, a book comes along that forces us to re-examine what we know and how we know it. This is one of those books. And while it is not always pleasurable to realize the many ways in which we are wrong, it is useful to figure out the cases where our intuitions fail us.”—Dan Ariely

Priceless: The Myth of Fair Value (and How to Take Advantage of It)
Poundstone dives into the latest psychological findings to investigate how and why prices are allocated.

Strangers to Ourselves: Discovering the Adaptive Unconscious
Wilson attempts to explain why there’s so much about ourselves that we fail to understand, which can lead to misdirected anger.

Born Liars: Why We Can’t Live Without Deceit
“… a lively, engaging read that also makes a bold argument about the role of lying in our lives”

Ulysses Unbound: Studies in Rationality, Precommitment, and Constraints
This provocative book argues that, very often, people may benefit from being constrained in their options or from being ignorant.

What Investors Really Want: Know What Drives Investor Behavior and Make Smarter Financial Decisions
“We all share behavioral traits that are major roadblocks to intelligent financial decisions. Bottom line: if you really want to achieve investment success, understand yourself and eliminate or minimize these traits. This book will help you do exactly that.”—John C. Bogle

Prospect Theory: For Risk and Ambiguity
“This masterful survey of major theories of choice and of their implications for measurement represents two decades of research and teaching by a flawless perfectionist. Wakker’s view of the field is scholarly, coherent and deeply personal.”—Daniel Kahneman

Utility of Gains and Losses: Measurement-Theoretical and Experimental Approaches
…provides a penetrating analysis of the axioms underlying human choice theory and a thorough review of the evidence. Most importantly, he illustrates the process of decomposing theories into testable properties that become the building blocks for better theories. His relentless desire to reformulate theories in response to evidence is what makes this an extraordinary book by an extraordinary scientist.