The Art of Thinking Clearlyby Rolf Dobelli
A fascinating look at human reasoning and essential reading for anyone who needs to make important decisions, written in readable prose with real-world examples and anecdotes.
This Art of Thinking Clearly will alter the way you think and change the way you make decisions every day. It is straightforward, clear, and always surprising. It reveals the most frequent judgmental errors and how to avoid them in 99 short chapters.
“[...] when it comes to pattern recognition, we are oversensitive.”
We overestimate the chances of our success because that is more common to see than failure in daily life.
Swimmer’s Body Illusion
We want to do something to achieve a particular state. We believe that we eventually achieve the same thing by doing something others do, who already achieved what we want. But we forget about the key traits one’s born with, which can’t be changed by intense work—for example, genetics.
The human brain wants to find patterns and rules in everything. It doesn’t only detect these patterns but invents some of them.
We feel our behavior is right when we behave the same as others. The more people do a certain thing or believe in something (e.g., an ideology), the more “appropriate” it seems.
Sunk Cost Fallacy (Concorde effect)
The more we spend time, money, and energy on something, the harder it is to quit. Instead, it becomes a reason to continue, even if it is already a lost cause. The more we invest in something, the greater the chance to continue.
When we receive something (e.g., a gift), we feel the urge to pay it back, even in other forms than how we received it.
We interpret new information to make it consistent with our preexisting theories, convictions, and beliefs. Any new information that conflicts with our preexisting beliefs is filtered out.
People tend to attribute greater accuracy to the opinion of an authority figure and be influenced by that opinion.
We can only judge something when it’s relative to something else. If we have something ugly, cheap, or small in front of us, we will automatically assume a slightly better thing as it is beautiful, expensive, or large. Absolute judgments are difficult for us to accept.
Actions to take
“Stories attract us; abstract details repel us.”
We construct a picture of the world according to the examples that easily come to our minds.
The It’ll-Get-Worse-Before-It-Gets-Better Fallacy
It is a subtype of the so- confirmation bias. The client has a problem. The expert gives a solution but warns that the situation will get worse before it gets better. The prediction will come true if the issue persists in getting worse. The client is satisfied, and the expert can credit his skill if the situation unexpectedly gets better. The expert succeeds either way.
We remember stories more easily than mere facts. It is easier to communicate in stories with emotion attached to them so we can remember and understand them better.
The tendency to overestimate our ability to predict the events after they have happened. You can find the hindsight bias in work when someone says, “I knew it!” – they don’t until it happens.
Our confidence in our own ability is greater than our actual performance.
Real knowledge is when someone invests much time and energy into understanding a topic. On the other hand, chauffeur knowledge is when someone learns how to put on a show without really understanding the topic.
Illusion of Control
We think we can control something that we have no power whatsoever.
Incentive Super-Response Tendency
We act in our own best interests in response to incentives.
Regression to Mean
Everything fluctuates around a mean. The stock market, the school rating, and the luck in love can have bad days, but eventually, everything will be average to its mean. But we believe something else has made things better, not the natural regression to the mean.
We frequently judge decisions based on the outcome rather than the decision-making process.
Actions to take
“Patience is indeed a virtue.”
The Paradox of Choice
The more options we have on something to choose from, the more unsure and dissatisfied we’ll be. Contrary, having fewer options leads to the opposite.
We are more likely to help or purchase something from someone we like. Liking someone could mean: they are attractive to us, they are similar to us in terms of their background, personality, or interests, or they like us.
When we possess something, we value it more highly.
We tend to understand unlikely coincidences as some kind of bigger power (telepathy, the sign of the universe, etc.), but they are just coincidences—which are possible events.
When we are in a group, we tend to follow and agree with the ideas of others when no one disagrees.
Neglect of Probability
We disregard probability when we are unsure about a decision.
We place a higher value on an object in a limited supply or opportunity.
People tend to ignore base rate information in favor of event-specific information. It occurs when we are too quick to make judgments, ignoring base rates or probabilities in favor of new information.
We believe that a certain random event is less likely or more likely to happen based on the outcome of a previous event or series of events. Like, if you toss a coin several times, and it is head four times in a row, you’d think the fifth time it’ll be tail. But a coin doesn’t remember the previous tosses.
We rely too heavily on the first piece of information we are given about a topic.
Actions to take
“There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know.”
We think they will follow a different path forever when things go on the same path for long periods. For example, ‘Mankind has always survived, so we will be able to tackle any future challenges, too.’
We prefer to avoid losses more than earn the same profits.
The more people work in our team, the less effort we put in individually.
We tend to underestimate the result of something that has exponential growth. This is because people rarely come across anything exponential in ancient times, but things are different now.
When betting on something, the winners are usually the losers as well because they pay more money on something than the real value of it.
Fundamental Attribution Error
We often underestimate situational factors and overestimate the influence of other people.
We think that the first event caused the second event to happen. Similarly, we believe that the presented cause of something is the real cause, but most of the time, it isn’t.
One example is the belief of most parents: “If there are many books in a student's home, they will perform better in school.” The fact is that educated parents place a higher value on their kids' education than uneducated parents. Nobody's grades will be influenced by a dusty copy of War and Peace alone; parents' educational backgrounds and genetics are more important.
Our tendency for a positive or negative impression of a person, company, brand, or product in one area to positively or negatively influence our opinion or feelings in other areas of this person, company, brand, or product.
There are different paths to the same goal, which are hard to be seen. We almost always choose the boring, conventional path, never thinking about how else we can achieve our goal.
We think we can predict things, but in reality, we can’t. We fall to the forecasters’ predictions, even when they have no success.
Actions to take
“If your only tool is a hammer, all your problems will be nails.”
We judge the conjunction of two possible events is more likely than one or both of the conjuncts. For instance, when we are presented with two scenarios: Airport is closed, flights are canceled; Airport is closed due to bad weather, flights are canceled. We think the second is more likely, but it’s the opposite because, in that scenario, only the weather can cancel the flights, but in the other scenario, everything else can do it.
We decide on options based on how they are presented.
We tend to favor action over inaction, often to our benefit. Sometimes we feel forced to act, even if it leads to nothing.
We tend to judge harmful actions as worse than harmful inactions, even if they result in similar consequences.
We tend to attribute positive events to our character, but we attribute negative results or events to external factors unrelated to ourselves and our faults.
We repeatedly return to our baseline level of happiness, regardless of what happens to us. It may be good or bad; it doesn’t matter.
When participants choose to participate in a survey by themselves, the sample of people is unrepresentative of the entire population. As a result, extrapolating findings from the sample to the entire population is challenging.
We tend to be easily influenced by associations. We see connections where none exist.
Beginners tend to overestimate their abilities, especially when they experience some kind of victory at the beginning of trying something new.
Cognitive dissonance refers to a situation involving conflicting attitudes, beliefs, or behaviors. We tend to seek consistency in our attitudes and perceptions, so this conflict causes feelings of unease or discomfort.
Actions to take
“[...] verbal expression is the mirror of the mind.”
We choose smaller, immediate rewards rather than larger, later rewards. This occurs more when the delay is closer to the present than the future.
We are more tolerant and helpful to others when they justify their behavior, whether the excuse is good or bad.
As we make decisions, the mental energy we have left gets weaker. The more decisions we make, the harder it becomes to make them; thereby, we produce low-quality decisions after a long session of decision-making.
We can't help but feel a connection to certain things, even if they are distantly related or from a long time ago (think about photos).
The Problem with Averages
We would think about averages if they were evenly distributed among everyone. Let’s say if the world’s richest man has $8 billion and the poorest has $0.1 on average, everyone would have $1 in cash. Things aren’t distributed evenly.
When we do something out of kindness or well-meaning, payments can ruin our will to do it. Financial rewards undermine any other motivations.
The more foggy a definition is, the more easily we fall to them. It is when tons of words cover up stupidity, intellectual laziness, or undeveloped ideas.
Will Rogers Phenomenon
The average values of both sets are increased when an element is moved from one set to another. As the comedian, Will Rogers put it: “When the Okies left Oklahoma and moved to California, they raised the average intelligence level in both states.”
We tend to believe that the more information we acquire to make a decision, the better that decision will be, even if that extra information might be irrelevant.
We tend to overvalue the result when we put a lot of energy into a task.
Actions to take
“Expectations are intangible, but their effect is quite real. They have the power to change reality.”
The Law of Small Numbers
We falsely assume that small samples should represent the population from which they are drawn.
People will behave the way you treat them or you expect them to.
The more intuitively we make decisions, the less rationally we query beliefs.
We believe that personality descriptions apply specifically to us (more than to other people), although those personality descriptions are actually filled with information that applies to everyone.
We think volunteering is the best when we do it ourselves. But people who are experts at that can do it far better while doing their job, thus making money and contributing to the economy.
The mental shortcut in which we make decisions is heavily influenced by our current emotions. When we are in a good mood, it signifies an absence of danger and, therefore, mitigates the need to think critically.
We wrongly think we have direct insight into the origins of our mental states while treating others' introspections as unreliable.
Inability to Close Doors
We like to have more possibilities, but this also means we lack real focus on the most important one.
We overvalue the importance of traditional techniques when thinking about the future and undervalue it in favor of the newest "killer apps" and trend inventions.
The origin of the argument fades from our memories more quickly than the argument itself. While our brain quickly forgets the source of information, the message itself gradually fades or even persists. Any knowledge that originates from an unreliable source thus gradually gains credibility. The message is more quickly lost than the discrediting force.
Actions to take
“[...] we are drunk on our own ideas.”
We consistently avoid evaluating results against the next best option. To strengthen our case for the current result, we frequently contrast it with the worst possible outcome.
Social Comparison Bias
Our tendency to refuse help to those who might surpass us, even if doing so makes us look foolish in the long run.
Primacy and Recency Effects
Our brain focuses more on the first adjectives in a list. The more recent the information, the better we remember it.
We become obsessed with our own concepts. This is accurate for various solutions, businesses, inventions, etc.
The Black Swan
A Black Swan is an improbable event that significantly impacts your life, career, business, and country.
We understand things better if they have been explained using examples from our field. Transferring insights from one field to another (like explaining to an investor something using examples from biology) is difficult, and the insight won’t pass.
We overstate agreement with others, assuming that everyone feels and thinks the same way we do.
Falsification of History
We think our memories are crystal clear, but in reality, our memories start losing some parts of them over time. So we reconstruct those parts to have a “full” memory again—which is wrong.
In-Group Out-Group Bias
Identifying with a group distorts our view of facts and the world.
We tend to avoid options that we consider to be ambiguous or to be missing information. We dislike uncertainty and are therefore more inclined to select an option for which the probability of achieving a favorable outcome is known.
Actions to take
“It’s OK to be envious – but only of the person you aspire to become.”
We tend to accept what is presented when presented with pre-set courses of action or defaults. When we are unsure what to do and lack expertise in the area, we consider the default as a form of advice and stick to that.
Fear of Regret
Similar to fear of missing out (the belief that others might be having fun while we are not present, thus causing bad feelings), we have fear if not doing something, we would miss something. This causes us to act irrationally in many ways.
We give more attention to outstanding features than they deserve.
The money we win, find, or inherit is treated much more carelessly than the money we have worked for.
Our tendency to put off difficult but necessary tasks like the grueling trip to the gym, changing to a more affordable insurance plan, or writing thank-you notes.
Envy can be sparked by various things, including wealth, fame, good looks, and status. Because the physical responses are the same, it is frequently mistaken for jealousy. The distinction is that an object is the object of envy (status, money, health, etc.).
The actions of a third party are the object of jealousy. There must only be two for envy. On the other hand, jealousy calls for three things: Peter is envious of Sam because the gorgeous neighbor girl called him instead.
We empathize with others, but only if we are in front of each other. If we are in a separate room, this effect is eliminated.
Illusion of Attention
We are certain that we are aware of everything happening in front of us. However, in practice, we frequently only notice what we are paying attention to.
The more at stake, the more exaggerated our assertions become.
When we think too much, we separate our minds from our feelings' wisdom. Emotions are just a different form of information processing. And sometimes, they provide better and wiser acts.
Actions to take
“Absence is much harder to detect than presence.”
We underestimate the time it will take to complete a future task, despite knowing that previous tasks have generally taken longer than planned.
We tend to look at things from the point of view of our own profession or specific expertise rather than from a broader or more human perspective.
We tend to remember interrupted or incomplete tasks or events more easily than tasks that have been completed. This pushes audiences to crave completed stories, resolved problems, answered questions, and achieved goals.
Illusion of Skill
We think that our success depends on our variety of skills, but in reality, there’s no need for the skills we have in many fields.
We give more weight to what is present than what is missing.
We frequently pick out and highlight the most attractive features while hiding the others.
Fallacy of the Single Cause
We want to find reason in everything and tend to hold on to the one that seems the most accurate, even if it’s not the real cause.
We think that a specific scenario is the cause of something’s success, but in many cases, we are wrong because we conclude the first possible connection is neglecting the others.
Different types of information trigger different reactions in our brains. In contrast to abstract, complex, and unprocessed information, which calms us, scandalous, shocking, human-centered, loud, and rapidly changing details all stimulate us.
We think that by consuming the news, we will stay informed, but in reality, we don’t.