First day & book reading
The big day!
I stayed awake until midnight, just to see the countdown on my computer arrive at the “In Stores Now!” I went to bed soon after but at 2:30 AM woke up, full of excitement, and could not fall a sleep again. I was not too worried because I was sure that the excitement would give me sufficient energy for the day ahead and indeed this was correct.
From 7:00 AM until 4:30 PM I went from studio to interview and back to studio. TV was a bit strange because the time was so short, and the pace was so fast. Radio was more relaxed and conversational. Magazine interviews felt even more natural.
At 7:00 PM I began my first “book reading.” Given my experience with reading poetry for experiments, I decided not to read but instead just talk about my research. The audience was filled with collaborators, former students, friends, family, and the teams from the literary agency and publisher. Overall, it was the most supporting audience one could imagine.
I intended to begin by describing my injury and how it set me on the path of thinking about irrational behavior more generally. Although I had spent time beforehand walking between the aisles of Barnes & Noble, planning what I would say, to my amazement the moment I started talking, I also started to cry (not too much but enough to prevent me from being able to talk).
This happened to me once before at an academic conference. I am very used to discussing my injury with people, and so at the conference I decided to share some of my experiences and make some comments about adaptation–the things that I got used to and the things I did not. The emotions that overwhelmed me the moment I started talking were surprising and I was unable to talk without crying. I tried to walk it off and start again, but without any luck. After a few attempts I gave up and just skipped to the other points I’d planned on making.
Before the “book reading” I was thinking about that experience, and I wondered if the existence of the audience at the academic conference was the trigger that so strongly amplified my emotions. I tried to predict if it would happen again with the audience at Barnes & Noble. I did not feel any of those emotions surface as I planned my talk among the bookstore’s aisles, so I assumed it would be fine–but of course I was wrong. The moment I started talking in front of an audience the emotions overcame me and I again had to skip to other topics.
This was a very good lesson on the power of emotions and our inability to predict their onset. In essence, when we don’t feel the emotions it is very hard to determine how they will influence us once they are evoked. And oddly, even with the research I have done on this very specific problem, I was unable to make a correct prediction.
I was also puzzled by the effect of the audience itself, and I am wondering if the existence of other people, in general, amplifies emotions–maybe this is what happens to actors, singers and other people that perform in front of audiences. I am not sure I want to continue doing these experiments on myself, but I sure am curious about it.
Irrationally yours
Dan
My latest book, The Upside of Irrationality, explores some positive and some negative ways that irrationality plays out in our lives.
I heard you on NPR today; I look forward to reading the book pronto. I want to know if you think we can assume the same irrational processes when pondering larger financial decisions, such as loans. I’m currently producing an audio doc on youth and debt. Are we like the children on Halloween? Is opting for the “big” candy bar at a price, when the baby one would be free analogous to other large scale tradeoffs- like a private school education over a public one? Thanks for writing.
We don’t have much data on the difference between small decisions and large decisions, but the data we do have suggests that they are basically the same.
There is some work showing that when decisions are more important (for example, when people are more accountable, they are more sensitive to irrelevant alternatives. There are also some results showing that when there is a lot of money on the line people get more stressed and find it harder to perform well.
But, we clearly need more research on this question.
Dan
I had the pleasure of meeting Dan last night in a reception here in DC. His presentation was as capturing as his book.
After I went home last night I started reading the book and couldn’t let go of it until my wife asked/forced me to turn the lights off.
This book is slowly but surely making me doubt what I thought I knew about economics.
As of today, the book is #1 on amazon popular economics, #17 in overall Amazon ranking.
Congratulations Dan
Yaser
Dan,
You confirm and present cogent explanations for many things that I have experienced as both a salesman and consumer. I am especially intrigued by your comments about market contracts and social contracts and the irreversibility of their combined sequential effect. This could be of particular interest when considering the proposal by some to pay secondary students for good grades. It also helps explain to me why speed limits don’t work anymore, particularly on expressways and interstates.
Regarding your research on zero as a special price, have you though about extending your dataset to include:
http://photos1.blogger.com/blogger/2477/1111/320/P1010002.jpg
Your work is thought provoking and important, thanks.
Dan,
Your talk at TTI Vanguard held me absolutely captivated. I cannot wait to dive into this book. My focus is in social media, collaboration and virtual worlds, and if you think the “real world” is fascinating, applying your work and observations to these spaces has kept me awake. Thank you and congratulations.
Hi Peter,
I love the “Free salvation” picture. Thanks for sending it
Best
Dan
Dan, I just tried the door experiment. Well, I’m pretty rational, so you theory that the shrinking door made me click on them more often is completely wrong. On the first trial (doors shrinking) I was rationally trying to decide if the values behind the doors depended on the doors. I later determined, right or wrong to stick with just one door. This is a learning curve exercise. Had you given me a third trial with the doors shrinking I would have stayed with just the first door as I quickly realized that it was costing me click just to look at the 2nd and 3rd door. If they’re all random in numbers then it is senseless to click on any but the first.
Now you may or may not have specified this in the instructions, but like most irrational creatures, I like to play the game abit before if I decide to get extremely detailed about the instructions.
Better not to give any instructions and do 4 trials. Throw out the first 2 as learning curves and then see about the 2nd 2. An interesting game but not a great experiment that shows any conclusion.
For example, It wouldn’t have mattered to me if the doors were growing turning red or spinning.
Hi Dan,
I just picked up the book a couple days ago and wanted to say that I’m really enjoying it. You’ve got a great writing style and the enthusiasm you have for this work really shines through.
Keep up the good work!
Dan, I am going out to buy the book today. I started reading your \
Congratulations, Dan!!! As you know, Manny wrote “(Go out and kill ‘em with laughter on your book tour, Dan! Gayle ordered a copy. I bought two!)”
Our Amazon order arrived yesterday! I’m sending you an email, but it might end up in your “bulk folder,” so keep an eye out for it, please!
Love,
Jackie and Manny
Just finished reading your wonderful book. I am jealous that not only can you do good research, but that it’s fun and that you can write so clearly, in simple, plain english in such an engaging manner. Damn it!
I do have some comments:
1) You say that our ethical compass is coarse – i.e., for most people the compass does not respond to little bit of cheating (stealing) but does respond to large scale theft (like walking away with a whole carton of red pencils). How do you explain that we all are enraged and furious when others steal even one pencil but we have a justification that it is OK when we commit a petty theft?
There’s much in game-theory literature under “fair play” … i.e., how much we choose to allocate to ourselves when we get to choose first which piece of the pie to keep. However, we are so damn fair-minded when we get to slice the pie but the opponent gets to choose first.
While you have written a wonderful book, i bet only 10K – 50K people will read it and most likely less than 10k will actually make small changes to their lives after learning from your book. I humbly suggest that you need to write different versions of the book, one each for: (a) schools to teach from, (b) churches, temples, mosques,… to preach from, (c) incentive compatible mechanisms for corporate human resource departments to implement in their companies, (d) policy prescriptions and enforcement mechanisms (impeachment) by the government.
i could go on with many suggestions, but here is something for someone to explain to the common people like us: why does our legal system not allow people to seek compensation for their time when trying to resolve a conflict with the adversary, but the attorney’s time is recompensible? Why is the losing party not liable for the litigation costs of the winning party, too, as is under the common law (in U.K.)?
jaffer
Dan, some more comments:
The experiment about coke versus money is not a fair comparison. Many people don’t mind sharing a 6 pack of coke or beer with colleagues at work or in a dorm (by leaving it in a fridge) whereas the money left in a common area is not for sharing but there most likely because someone accidentally left it there.
There’s a second reason why people would take coke but not money. Coke quenches thirst immediately for which there may not exist a quick, nearby substitute whereas taking money would not satisfy anyone’s immediate need. You see, most people have some money in thier pockets (or wallets) and stealing a few bucks would not increase their immediate utility as much as the readily available cold can of coke would for a thirsty person.
Thinking further about your pencil experiment. First, people don’t steal a carton of pencils because they don’t need a carton whereas they steal one pencil because that is all they need. Moreover, paying 10 cents for a pencil at a store has a large transaction cost, which is a pure frictional cost (i.e. a deadweight loss) and can be avoided by just stealing a pencil. The social welfare is greater if one just steals a pencil then if one spends the time to purchase it.
So mow I’m beginning to think that perhsps your research is not robust. But I can’t say for sure because I’m not an experimentalist. It’s easy for me to criticize. I do realize surveys and social experiments are difficult to conduct. Your book is fun to read but my hunch is that it is not thorough. On the other hand, you are at MIT and I my other hunch is that the work done at MIT is probably rigorous but you have explained stuff in a way where the rigor does not show.
Oh well, now I don’t know how seriously to take your work. I am not skilled enough to understand academic papers that you may have written in journals.
I don’t like your football tickets experiment either. The reason why the ticket winners wanted $2400 might be because that was the “going” price for the tickets in the secondary (scalpers) market. And the reason the students who did not win the tickets in the lottery were willing to pay at most ($170 or $175, you report two different numbers) is because that is all they could afford. You see, the students don’t have the wealth or the high income to offer $2400, which is the price in the broad market comprimising mostly rich alums who were able to afford the high price of $2400.
I am now thinking you did not do thorough research. My hunch is if I were to read your book again and were paid to look for flaws, I’d come up with many, many flaws.
Jaffer: Those are some really thorough and lengthy comments. Such a wonderful effort can only lead to more wonderfulness in discussion.
Jaffer:
Some more comments on your comments. Though I lack the expertise to fully determine your state of mind from the comments, I think I may detect a strain contrariness and a gradual up-slope of shrillness and attention-seeking. I’m just not sure how seriously to take them.
Jaffer, I don’t like your third comment either. Who posts 3 times in such short order, becoming more negative as they go?
Dan: digging the book so far, though it was completely irrational of me to purchase it, given my finances.
Dan
Your example of wardrobe is flawed, too.
As long as the merchants know that customers could use clothes (and books and other items) and then return them, then the contract between them, which includes being able to return the items, which by the way has evolved gradually over time, with cool business-minded thinking, reflects a market arrangement that is acceptable to the merchants. Indeed the return policy is chosen by the merchants in the face of the alternative where they could insist that all sales are final – i.e., no returns – as some stores do.
There clearly is a social optimal with an return policy arrangement than without it. The initial price of the merchandise includes the option of returning whereas the subsequenct markdown price may not include the option to return and the item is marked as final sale.
A non-returnable policy might lead to lower sales and profits and it probably does.
The phenomenon you mentiond is more prevalent for the books and (ahem!) I’m wondering how many people might return your book too adter thinking carefully about your experiments and examples.
You see, bookstores even encourage patrons to browse through books and magazines, while eating and drinking in their coffee bars. This environmnet soils merchandise, damages the covers, and causes bookstores to spend money hiring workers to pick up the books and reshelf them. Yet, they choose to offer such environments and in fact encourage it. From your perspective, those who read but then don’t pay for the items are probably cheating the merchant. The bookstore can observe the people who read but don’t pay for the items them and yet don’t handcuff them as they do a shoplifter.
This means there is nothing ethically or legally wrong when both parties consent to it and find it mutually beneficial. If this is the way that firms choose to market, why should you question whether an ethic has been violated, in such a case?
i forgot to mention in my previous note that merchants know they could institute a plicy whereby returned items would be charged, say, a 15% re-stocking fee – i.e., the customer would not receive a full refund – and yet most of them do not insitute this policy. Some tried it but decided to reverse it.
Now that I think carefully about the examples and experiments discussed in the book, I find most of them to be flawed.
I wondered why I did not catch the flaws when reading the book. I now realize it was because Dan either cleverly manipulates the readers or he is just a natural at it and does not realize that he is manipulating the audience. I will reserve personal judgement against Dan, whether his style is purposely or just inadvertently manipulative. He claims to be expert in behavioral science so I can imagine that the book and the manipulative style are a social experiment that he is conducting to see how people respond to his book, via reviews, comments and blogs.
Here is why I think the style is manipulative. His very first discussion is about his personal experience with a tragic severe skin burn, which led him to question how people perceive things and how they rationalize their behavior. In writing about his personal experience he draws the audience’s sympathy – i.e., he gets them into a sympathetic and trusting mode, whereby they immediately admire him for overcoming his tragedy and delivering great research. Very clever, indeed!
Throughout the book he mentions MIT, Harvard, Berkeley as the places where he conducts research and that he had an offer to be at Stanford – he cleverly drops names of research schools in an attempt to create an impression that his work is rigorous. So, as a sucker, I sub-consciously gave him a pass while reading the book, but now feel I was duped.
I think Dan has inadvertently done MIT a disservice. I thought MIT was a rigorous school, which I’m now beginning to doubt.
your chapter on procrastination is also flawed because you did not control for the mindset and biases of the graders where they could be harsher in grading when it all must be done at the end of the term, when they themselves are tired and the grades have to be submitted soon, whereas if the assignments are submitted gradually over the term, the graders may be more lenient and willing to read the assignments carefully and award higher grades to the students, on average.
sloppy research!
Hi Jaffer,
I am not sure I understand all your points, but some of them are clearly important.
First, let me differentiate between the experiments, where we manipulate something in a controlled way, and example I bring up from the marketplace. The token experiment is an example for a controlled experiment, whereas the pencil story is just an example that I used to try and give the intuition in a less sterile environment. While I trust the results of the experiments, you are right that we need to be careful when we extrapolate from them.
I should also point out that these extrapolations to the real world are meant as ways to think about the problems, and suggest possible approaches, and not as absolute recommendations for what to do.
When you think about the experiments and the examples, I think that the most useful way to do this is to try and figure where these might play in life in the way I propose, and where they might have a different effect. For example, are there cases where people will cheat less when the action is removed from cash (as opposed to my proposal that they will cheat more), or procrastinate more when they have deadlines etc.
Dan
Wow. Dan, I have really been enjoying the book, for your clever experiments and insights as much as your amusing and engaging style of writing. What’s really great about this book is that it’s highly approachable for people from all walks of life, and I would suspect that nearly everyone will see parallels to situations that they have encountered in their lives. I love the anecdotes and the tie-ins to real-life phenomena; I’ve been smiling pretty much the whole time that I’ve been reading. I also think you have made it easy to distinguish when you are discussing your experiments versus observations or allegories. In my opinion, the best social science is widely (but never wholly) generalizable, and also thought-provoking and entertaining. Predictably Irrational definitely qualifies on all three counts, whether or not you agree with every scrap of what Dan has to say. Thanks again for a wonderful read and I look forward to more in the future!
While there’s a lot of fuss on this page about methodological rigor, what people need to understand about social science experiments is that there are always going to be ways to improve upon them. There’s a reason why no one refers even to Kahneman and Tversky’s hallowed concept as Prospect “Law.” As a matter of fact, Gerd Gigerenzer and other researchers have been recognized for identifying potential flaws in Kahneman and Tversky’s work–one would hope that it is a symbiotic relationship from which both sides are able to listen, learn, and refine. Where this process does NOT work well is when constructive criticism degenerates into sour grapes or ad hominem attacks, which is what seems to be happening above. Even the appearance of such behavior severely undermines the credibility of the critic as a scientific investigator. Jaffer, I think you may have some important things to say and some good ideas to suggest, but the manner in which you have tried to do so probably will not attract a lot of support or calls for collaboration.
Read great literature! None of this is new. In fact, writers have known the predictability of irrationality for centuries, which is why their books are still read and the social scientists who think they’re discovering something are only reinventing the wheel.
Dan-
I read through some of what Jaffer had to say .. one point did catch my eye.
“why does our legal system not allow people to seek compensation for their time…”
It reminded me of another area where we all spend lots of uncompensated time and untold frustration .. Customer Service calls.
If you were to devise tests to analyse the various situations at play I’d buy that book too (if only to see your clever experiments and read about the results). If you could develop and market a way to mitigate the situation that ought to be worth an amazing amount.
I don’t see that the providers have any incentive to improve. The representatives don’t like the callers (I wish I could find the website again where they vent to each other). The standard solution, insulating anyone who could actually solve an issue by means of an infoswitch, front-line rep, offshore staff, just continues to slow things down and increase the frustration .. while justifying the amounts of money the providers spend to improve things.
-Rick
Jaffer:
I am not sure what has led you to be so negative about such wonderful research. It is unreasonable and unfair to expect Dan to address all the details of the research in his book.
I suggest that you read the original papers that Dan wrote that describe the research in detail. I am a seasoned researcher who has read several of Dan’s papers (which you can find posted on this website) to explore some questions I had about what is in the book). I can tell you that hard as I tried (and I am embarrassed to admit that I did try fairly hard) I could not detect any significant flaws. Most of your concerns are completely misguided.
I was fascinated by your interview on WNYC (public radio) today. As a hospital chaplain I was interested to hear that some of the impetus was from your own experiences in a burn unit. Have you considered doing some consulting or speaking for hospitals on teh importance of finding the most tolerable way to administer painful treatments to patients?
Dear Dan,
You captivated us – your audience on the First Night – immediately by being so transparent. You were overwhelmed with emotion and there was no dissembling possible.
A side effect I think is that we trust EVERYTHING you said, since you were so honest at that opening moment.
The next day I met the philosopher I mentioned to you afterwards – Edward de Bono – and told him all about you and your book. It’s how you function – lateral thinking, and “PO” = beyond yes and no, a sort of “what if” state.
Thanks for your teaching, experimenting, and generous sharing of your life,
Suzi in Washington DC, who just happened to be at Barnes and Noble on the 21st!
As a healthcare worker who occasionally removes bandages, I wonder if the nurses’ usual strategy is intuitively preferred because it minimizes their own suffering. You feel bad hurting someone else, even if it’s absolutely necessary, but it’s very difficult for the person not feeling the pain to gauge the intensity of another’s pain. However, its duration is readily observed. By ripping the bandage quickly, the nurse gets it over with and can start to put the unpleasantness behind. I suspect this is something you’ve already considered, but if not, it may be worth investigation.
Dan,
It’s possible that your crying is the result of not having properly recovered from your burn trauma. There is a theory, based on work by Peter A. Levine (Waking the Tiger: Healing Trauma), that trauma is stored in our central nervous sytems if not propery dealt with and it can manifest itself in many ways, including unexpected and unexplained crying. Self Regulation Therapy came out of that work, and I can tell you from my personal experience with it that it works. A Google search of “self regulation therapy” yielded the name of a therapist right in your neighborhood, i.e. Cambridge. I would recommend the therapist who helped me, but she lives in Seattle. I bought your book today and look forward to reading it.
Dan was interviewed by WNYC’s Leonard Lopate recently. As a result of that interview I plan to purchase the book. During your conversation with the host you spoke about your motivation for writing this book and a tragic explosion you were involved in. As a behavioral economist, you said the nurses performed removing your bandages in a way that was to their mind, the best way. They ripped off the bandages quickly, but your research found doing it slower over a longer period was proven better for the comfort of the patients. I wonder if your research investigated the underlying reasons (why) for the nurses’ haste in the procedure. My thought [as a social worker] would be, not only are they attempting to shorten the duration (not intensity) of pain for the patients, but more importantly, for the nurses to experience a shorter duration (thus lesser intensity) of pain by inflicting this procedure onto their patients. The quicker the procedure goes for the nurses, the quicker they can return to not feeling empathetic pain. By drawing out the procedure, (lessening the pain for the patient), this increases and makes greater the length of pain for the nurse.
As soon as I heard about it, I ordered the book for my bookstore and this morning wrote about it on my blog. So first, thanks for the book! Also (though I’m sure someone else did this part), I love the cover.
Your story about emotions welling up as you tell others your personal story is fascinating, and I suspect you’ve got hold of something when you speculate on the presence of others as a trigger for emotion. After all, the outward manifestations of emotion are signs to others. I’ve wondered at times about people (myself and others) becoming very emotional when recounting an incident from many years in their past. Love your questions!