Thoughts On Thingking Fast And Slow (Part III)

How do you sum up a masterwork like Thinking Fast and Slow?

How do you sum up a masterwork like Thinking Fast and Slow? It is certainly not possible in a single blog post. However, an attempt will be made to conclude this three-part book report style summary now that the book is finally done. This was one seriously heady read but well worth the (significant) time it took to complete. It has fundamentally changed how I think.

Massive highlighted segments and copious margin notes are a fair sign that a work of non-fiction has been valuable and this book is a treasure trove of useful psychological information. As most psychology readings are either describing different schools of thought or diagnosing maladaptive conditions, it was refreshing to be reading about economic examples backed up with statistics and actual experiments with a voice that was “around the water cooler” in tone.

Written eloquently and sequenced with the same logic that is prescribed throughout the book, its heavy concepts are digestible and you get the feeling, especially near the end, that Kahneman put an epic amount of thought into making these things understandable and actionable. That said, it is probably safe to say that almost none of Daniel Kahneman’s suggestions for a more correct or accurate way of “thinking” or facilitating information sharing are easily executed. They typically involve a significant amount of “unlearning” the way we have been programmed to process information for our entire lives. Unless you are a used car salesman

A quick example is the idea of base-rate neglect. Our mind, specifically the character discussed previously as System 1, is always looking for a story, and has an incredible facility for masking probability. You know the odds are against a fairy tale marriage but you do not believe this applies to you. You know more than half of restaurants close within a year but you open one anyway. This is not to say you are apt to ignore the facts, it simply means the weight of the criteria involved tend to be skewed towards optimism in the face of these facts. This is less a failing of System 1, which simply seeks stories, as it is the inherent laziness of System 2, which seems to be asleep most of the time and letting System 1 make decisions above its pay grade.

The Experiencing Self and the Memory Self are two additional devices introduced later in the book and covered in much less detail than System 1 and System 2. This is a pity. Although Kahneman introduces them with his, at this point typical, “surprising experimental findings” context and then proceeds to elucidate on their natures, I was left wanting more. The sum up is that the locus of control during an experience is the Experiencing Self. For example, enduring the pain of submersing a hand in extremely cold water and being asked how it feels during the emersion. The Memory Self is the separate character that pieces together the experience from fragments and nuance and then formulates a facsimile of the experience from which to base evaluations on. This is the Self that fills out a survey of how the experiments went afterwards. In many, many cases, the Memory Self creates an inaccurate memory and decisions are based on this that are messed up. (IE: Choose a more painful option from a set of options). He also goes on to describe some very intriguing attempts to measure pleasure and pain on a universal scale that will no doubt continue to be developed as they go well beyond conventional frameworks. There is probably enough for a whole other book on this topic.

Finally, the author stitches up his story with comparisons of Humans and Econs. He uses these two characters and their contrasting behaviors to describe the way economists say we act, and the way humans have acted during countless actual experiments he has performed throughout his career. Using these numerous juxtapositions he masterfully illustrates how contemporary economic theory is just plain flawed and the idea of “rational agent” as it is used by people like those at the Milton Friedman’s Chicago school of economics, is just plain wrong. It is easy to see why this guy won a Nobel prize for economics as he is not only gifted at sifting through statistical data for relevant facts and piecing them together into a relevant story, he is gifted enough to piece them together in a way that even I can understand.

Being able to string a story together is important because System 1 is always listening for a story to latch onto at the expense of the thoughtful System 2’s data analysis. The sequence of that story is also all-important. When providing information for decisions to people what you say is equally if not less important than in what order you present it. Kahneman goes through numerous examples of detailed experiments to get across the idea that people can be influenced greatly by simple nuance, like a pleasant breeze on their face while they are contemplating a purchase. Therefore, the order in which your proposal or presentation or story is put together is extremely powerful because it elicits different reactions at different points on a timeline. Change the order or language and you can easily induce completely different responses. We all know some of this intuitively but Kahneman really drills down to the juicy bits.

Finally, the number one takeaway from this book relevant to communication professionals is simply a potential loss is more important than a potential win. People fear loss and undervalue gains. This is probably genetically valuable and represents a trait that has been handed down by successful survivors for thousands of years – but it invariably leads to silly decisions when dealing with our complex modern world. This is at the heart of Kahneman’s Prospect Theory, for which he won the Nobel prize for economics, and the driving mechanism behind a number of important and powerful things in our world, like the insurance industry.

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