I found this book to be deceptively dense. It's not a huge book in terms of size and it's not a difficult book in terms of language; on the contrary, it's a good size and the words within it don't require a constant delve into the dictionary. But boy does it pack a punch. I often found myself having to go back to re-read a sentence or paragraph to make sense of it. Not because it's badly written; purely because of the depth of the content. I was stop and start with it for a number of years but I'm pleased that I made it to the end and pleased that I went through my highlights and underlines a second time to consolidate it all.
In terms of content, it covers a number of topics in the field of psychology and behavioural economics. A running theme throughout the book, however, are two modes of thinking: an impulsive, intuitive, gullible mode of thinking (System 1), and a cautious, effortful, doubtful but lazy mode of thinking (System 2). And it's these two modes of thinking from which the book gets its name: Thinking, Fast and Slow. System 1 is the fast mode of thinking that we defer to more often than not (whether we realise it or not), and System 2 is the slow mode of thinking that we engage in only when we're really paying attention.
Overall, I found this book to be a really rich piece of work and definitely one of the best psychology books that I've ever read. What Susan Cain's book Quiet did to make us appreciate quietness and introversion, I think this book has done to make us appreciating slow, methodical thinking.
I've pulled out my notes from the book and typed them up below into two parts: the first part contains definitions of concepts mentioned in the book, and the second part consists of my favourite quotes from the book.
Concepts defined and discussed in the book
- What You See Is All There Is: Jumping to conclusions on the basis of limited evidence. We cannot help dealing with the limited information we have as if it were all there is to know.
- Framing effect: Different ways of presenting the same information often evoke different emotions.
- Substitution: Answering a related but easier question in place of a harder one.
- Heuristic: A simple procedure that helps find adequate, though often imperfect, answers to difficult questions.
- Affect heuristic: Letting your likes and dislikes (i.e. emotions) determine your beliefs about the world.
- Availability heuristic: You assign a probability to an outcome according to the ease with which instances of it come to mind. So when instances of an event come to mind with ease (e.g. because you have heard about cases of it in the news a number of times), then you assign it a higher probability.
- Availability bias: We remember our own individual efforts and contributions much more clearly than those of the other.
- Availability cascade: The mechanism through which biases flow into policy and priorities are reset. A media story frightens the public, and those fears encourage more media courage. The issue becomes politically important because it is on everyone's mind, and the response of the political system is guided by the intensity of public sentiment.
- Probability neglect (also named denominator neglect): When we are thinking about the numerator – the story on the news – without thinking about the denominator.
- Conjunction fallacy: When we judge a conjunction of two events (e.g. Linda is a bank teller and active in the feminist movement) to be more probable than one of the events (e.g. Linda is a bank teller) in a direct comparison.
- Narrative fallacy: When flimsy accounts of the past shape our views of the world and our expectation for the future. The elements of luck and randomness are often overlooked, and the elements of skill and talent are often highlighted. This arises inevitably from our continuous attempt to make sense of the world.
- Halo effect: When we incline to match our view of all the qualities of a person to our judgement of one attribute that is particularly significant. For example, if we think a baseball pitcher is handsome and athletic, we are likely to rate him better at throwing a ball too. Or, if we think a player is ugly, we will probably underrate his athletic ability.
- Planning fallacy: Plans and forecasts that (1) are unrealistically close to best-case scenarios and (2) could be improved by consulting the statistics of similar cases.
- Optimistic bias: When we view the world as more benign that it really is, our own attributes as more favourable that they are, and the goals we adopt as more achievable that they are likely to be.
- Loss aversion: When the response to losses is stronger than the response to corresponding gains.
- Sunk-cost fallacy: The decision to invest additional resources in a losing account, when better investments are available. An example of this is driving into a blizzard because one has paid for tickets to attend an event.
- The focusing illusion: Nothing in life is as important as you think it is when you are thinking about it.
Quotes from the book
The Lazy Controller: "... both self-control and cognitive effort are forms of mental work... people who are simultaneously challenged by a demanding cognitive task and by a temptation are more likely to yield to the temptation... self-control requires attention and effort..."
The Associative Machine: "... being amused tends to make you smile, and smiling tends to make you feel amused... You can see why the common admonition 'to act calm and smile regardless of how you feel' is very good advice: you are likely to be rewarded by actually feeling calm and kind..."
Cognitive Ease: "A reliable way to make people believe in falsehoods is frequent repetition, because familiarity is not easily distinguished from truth."
Cognitive Ease: "If you care about being thought credible and intelligent, do not use complex language where simpler language will do... couching familiar ideas in pretentious language is taken as a sign of poor intelligence and low credibility."
Cognitive Ease: "... when in a good mood, people become more intuitive and more creative but also less vigilant and more prone to logical errors... A good mood is a signal that things are generally going well, the environment is safe, and it is all right to let one's guard down. A bad mood indicates that things are not going very well, there may be a threat, and vigilance is required."
Norms, Surprises, and Causes: "How many animals of each kind did Moses take into the ark? The number of people who detect what is wrong with this question is so small that it has been dubbed the 'Moses illusion'. Moses took no animals into the ark; Noah did."
Norms, Surprises, and Causes: "When something cement does not fit into the current context of activated ideas, the system detects an abnormality, as you just experienced. You had no particular idea of what was coming after 'something', but you knew when the word 'cement' came that it was abnormal in that sentence. Studies of brain responses have shown that violations of normality are detected with astonishing speed and subtlety."
A Machine for Jumping to Conclusions: "... people (and scientists, quite often) seek data that are likely to be compatible with the beliefs they currently hold."
A Machine for Jumping to Conclusions: "If you like the president's politics, you probably like his voice and his appearance as well. The tendency to like (or dislike) everything about a person – including things you have not observed – is known as the halo effect."
A Machine for Jumping to Conclusions: "The sequence in which we observe characteristics of a person is often determined by chance. Sequence matters, however, because the halo effect increases the weight of first impressions, sometimes to the point that subsequent information is mostly wasted."
A Machine for Jumping to Conclusions: "It is the consistency of the information that matters for a good story, not its completeness. Indeed, you will often find that knowing little makes it easier to fit everything you know into a coherent pattern."
Anchors: "My advice to students when I taught negotiations was that if you think the other side has made an outrageous proposal, you should not come back with an equally outrageous offer, creating a gap that will be difficult to bridge in further negotiations. Instead you should make a scene, storm out or threaten to do so, and make it clear – to yourself as well as to the other side – that you will not continue the negotiation with that number on the table."
Availability, Emotion, and Risk: "Unusual events attract disproportionate attention [by the media] and are consequently perceived as less unusual than they really are. The world in our heads is not a precise replica of reality; our expectations about the frequency of events are distorted by the prevalence and emotional intensity of the messages to which we are exposed."
Availability, Emotion, and Risk: "The affect heuristic is an instance of substitution, in which the answer to an easy question (How do I feel about it?) serves as an answer to a much harder question (What do I think about it?)."
Availability, Emotion, and Risk: "... small risks: we either ignore them altogether or give them far too much weight – nothing in between."
Availability, Emotion, and Risk: "... the number of casualties from terror attacks is very small relative to other causes of deaths. Even in countries that have been targets of intensive terror campaigns... the weekly number of casualties almost never came close to the number of traffic deaths. The difference is in the availability of the two risks, the ease and the frequency with which they come to mind. Gruesome images, endlessly repeated in the media, cause everyone to be on edge."
Availability, Emotion, and Risk: "Rational or not, fear is painful and debilitating, and policy makers must endeavour to protect the public from fear, not only from real dangers."
The Illusion of Understanding: "The explanatory stories that people find compelling are simple; are concrete rather than abstract; assign a larger role to talent, stupidity, and intentions than to luck; and focus on a few striking events that happened rather than on the countless events that failed to happen."
The Illusion of Understanding: "You build the best possible story from the information available to you, and if it is a good story, you believe it. Paradoxically, it is easier to construct a coherent story when you know little, when there are fewer pieces to fit into the puzzle. Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance."
The Illusion of Validity: "... declarations of high confidence mainly tell you that an individual has constructed a coherent story in his mind, not necessarily that the story is true."
The Illusion of Validity: "The idea that the future is unpredictable is undermined every day by the ease with which the past is explained... our tendency to construct and believe coherent narratives of the past makes it difficult for us to accept the limits of our forecasting ability... we cannot suppress the powerful intuition that what makes sense in hindsight today was predictable yesterday..."
The Engine of Capitalism: "If you were allowed one wish for your child, seriously consider wishing him or her optimism. Optimists are normally cheerful and happy, and therefore popular; they are resilient in adapting to failures and hardships, their chance of clinical depression are reduced, their immune system is stronger, they take better care of their health, they feel healthier than others and are in fact likely to live longer."
Prospect Theory: "The reason you like the idea of gaining $100 and dislike the idea of losing $100 is not that these amounts change your wealth. You just like winning and dislike losing – and you almost certainly dislike losing more than you like winning."
Prospect Theory: "For most people, the fear of losing $100 is more intense than the hope of gaining $150. We concluded from many such observations that 'losses loom larger than gains' and that people are loss averse."
Prospect Theory: "The pain of losing $900 is more than 90% of the pain of losing $1,000."
Bad Events: "... a single cockroach will completely wreck the appeal of a bowl of cherries, but a cherry will do nothing at all for a bowl of cockroaches... the negative trumps the positive in many ways..."
Bad Events: "... the long-term success of a relationship depends far more on avoiding the negative than on seeking the positive... a stable relationship requires that good interactions outnumber bad interactions by at least 5 to 1..."
Bad Events: "... we are driven more strongly to avoid losses than to achieve gains... not achieving a goal is a loss, exceeding the goal is a gain... The aversion to the failure of not reaching the goal is much stronger than the desire to exceed it."
Bad Events: "Loss aversion creates an asymmetry that makes agreements difficult to reach. The concessions you make to me are my gains, but they are your losses; they cause you much more pain than they give me pleasure."
Bad Events: "Animals, including people, fight harder to prevent losses than to achieve gains... A biologist observed that 'when a territory holder is challenged by a rival, the owner almost always wins the contest – usually within a matter of seconds'."
Rare Events: "... low-probability events are much more heavily weighted when described in terms of relative frequencies (how many) than when stated in more abstract terms of 'chances', 'risk', or 'probability' (how likely)."
Keeping Score: "Boards of directors... often replace a CEO who is encumbered by prior decisions and reluctant to cut losses. The members of the board do not necessarily believe that the new CEO is more competent than the one she replaces. They do know that she does not carry the same mental accounts and is therefore able to ignore the sunk costs of past investments in evaluating current opportunities."
Keeping Score: "... be explicit about the anticipation of regret. If you can remember when things go badly that you considered the possibility of regret carefully before deciding, you are likely to experience less of it."
Frames and Reality: "A bad outcome is much more acceptable if it is framed as the cost of a lottery ticket that did not win than if it is simply described as losing a gamble... losses evoke stronger negative feelings than costs."
Two Selves: "Memories are all we get to keep from our experience of living, and the only perspective that we can adopt as we think about our lives is therefore that of the remembering self."
Two Selves: "A comment I heard from a member of the audience after a lecture illustrates the difficulty of distinguishing memories from experiences. He told of listening raptly to a long symphony on a disc that was scratched near the end, producing a shocking sound, and he reported that the bad ending 'ruined the whole experience.' But the experience was not actually ruined, only the memory of it. The experiencing self had had an experience that was almost entirely good, and the bad end could not undo it, because it had already happened. My questioner had assigned the entire episode a failing grade because it had ended very badly, but that grade effectively ignored 40 minutes of musical bliss. Does the actual experience count for nothing?"
Two Selves: "The experiencing self does not have a voice. The remembering self is sometimes wrong, but it is the one that keeps score and governs what we learn from living, and it is the one that makes decisions. What we learn from the past is to maximise the qualities of future memories, not necessarily of our future experience. This is the tyranny of the remembering self."
Two Selves: "Tastes and decisions are shaped by memories, and the memories can be wrong."
Life is a Story: "A story is about significant events and memorable moments, not about time passing... This is how the remembering self works: it composes stories and keeps them for future reference."
Life is a Story: "The photographer does not view the scene as a moment to be savoured but as a future memory to be designed."
Life is a Story: "The word *memorable* is often used to describe vacation highlights, explicitly revealing the goal of the experience."
Life is a Story: "Odd as it may seem, I am my remembering self, and the experiencing self, who does my living, is like a stranger to me."
Thinking About Life: "The focusing illusion creates a bias in favour of goods and experiences that are initially exciting, even if they will eventually lose their appeal. Time is neglected, causing experiences that will retain their attention value in the long term to be appreciated less than they deserve to be."
