Are We in Control of Our Decisions by Dan Ariely (Full Transcript)

March 24, 2016 11:48 am | By More

Are We in Control of Our Decisions by Dan Ariely at TED Talk – Transcript

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Dan Ariely – Behavioral economist

I’ll tell you a little bit about irrational behavior. Not yours, of course — other people’s.

So after being at MIT for a few years, I realized that writing academic papers is not that exciting. You know, I don’t know how many of those you read, but it’s not fun to read and often not fun to write — even worse to write. So I decided to try and write something more fun. And I came up with an idea that I would write a cookbook. And the title for my cookbook was going to be, “Dining Without Crumbs: The Art of Eating Over the Sink.”

And it was going to be a look at life through the kitchen. I was quite excited about this. I was going to talk a little bit about research, a little bit about the kitchen. We do so much in the kitchen, I thought this would be interesting. And I wrote a couple of chapters, and I took it to MIT Press and they said, “Cute, but not for us. Go and find somebody else.”

I tried other people, and everybody said the same thing, “Cute. Not for us.”

Until somebody said, “Look, if you’re serious about this, you first have to write a book about your research; you have to publish something, then you’ll get the opportunity to write something else. If you really want to do it, you have to do it.”

I said, “I don’t want to write about my research. I do this all day long, I want to write something else, something a bit more free, less constrained.”

And this person was very forceful and said, “Look, that’s the only way you’ll ever do it.”

So I said, “Okay, if I have to do it –“ I had a sabbatical. I said, “I’ll write about my research, if there’s no other way. And then I’ll get to do my cookbook.”

So, I wrote a book on my research. And it turned out to be quite fun in two ways. First of all, I enjoyed writing. But the more interesting thing was that I started learning from people. It’s a fantastic time to write, because there’s so much feedback you can get from people. People write to me about their personal experience, and about their examples, and what they disagree and nuances. And even being here — I mean, the last few days, I’ve known really heights of obsessive behavior I never thought about. Which I think is just fascinating.

I want to tell you a little bit about irrational behavior, and I want to start by giving you some examples of visual illusion as a metaphor for rationality. So think about these two tables. And you must have seen this illusion. If I asked you what’s longer, the vertical line on the table on the left, or the horizontal line on the table on the right, which one seems longer? Can anybody see anything but the left one being longer? No, right? It’s impossible. But the nice thing about visual illusion is we can easily demonstrate mistakes. So I can put some lines on; it doesn’t help. I can animate the lines. And to the extent you believe I didn’t shrink the lines, which I didn’t, I’ve proven to you that your eyes were deceiving you.

Now, the interesting thing about this is when I take the lines away, it’s as if you haven’t learned anything in the last minute. You can’t look at this and say, “Okay. Now I see reality as it is.” Right? It’s impossible to overcome this sense that this is indeed longer. Our intuition is really fooling us in a repeatable, predictable, consistent way and there is almost nothing we can do about it, aside from taking a ruler and starting to measure it.

Here’s another one. It’s one of my favorite illusions. What color is the top arrow pointing to?

Brown. Thank you.

The bottom one? Yellow. Turns out they’re identical. Can anybody see them as identical? Very, very hard. I can cover the rest of the cube up. If I cover the rest of the cube, you can see that they are identical. If you don’t believe me, you can get the slide later and do some arts and crafts and see that they’re identical. But again, it’s the same story, that if we take the background away, the illusion comes back. There is no way for us not to see this illusion. I guess maybe if you’re colorblind, I don’t think you can see that. I want you to think about illusion as a metaphor.

Vision is one of the best things we do. We have a huge part of our brain dedicated to vision — bigger than dedicated to anything else. We do more vision more hours of the day than we do anything else. And we’re evolutionarily designed to do vision. And if we have these predictable repeatable mistakes in vision, which we’re so good at, what’s the chance that we don’t make even more mistakes in something we’re not as good at, for example, financial decision-making.

Something we don’t have an evolutionary reason to do, we don’t have a specialized part of the brain, and we don’t do that many hours of the day. The argument is in those cases, it might be that we actually make many more mistakes. And worse — not having an easy way to see them, because in visual illusions, we can easily demonstrate the mistakes; in cognitive illusion it’s much, much harder to demonstrate to people the mistakes.

So I want to show you some cognitive illusions, or decision-making illusions, in the same way. And this is one of my favorite plots in social sciences. It’s from a paper by Johnson and Goldstein. It basically shows the percentage of people who indicated they would be interested in giving their organs to donation. And these are different countries in Europe. You basically see two types of countries: countries on the right, that seems to be giving a lot; and countries on the left that seems to be giving very little, or much less.

The question is, why? Why do some countries give a lot and some countries give a little? When you ask people this question, they usually think that it has to be something about culture. How much do you care about people? Giving your organs to somebody else is probably about how much you care about society, how linked you are. Or maybe it’s about religion.

But if you look at this plot, you can see that countries that we think about as very similar, actually exhibit very different behavior. For example, Sweden is all the way on the right, and Denmark, which we think is culturally very similar, is all the way on the left. Germany is on the left, and Austria is on the right. The Netherlands is on the left, and Belgium is on the right. And finally, depending on your particular version of European similarity, you can think about the UK and France as either similar culturally or not, but it turns out that from organ donation, they are very different.

By the way, the Netherlands is an interesting story. You see, the Netherlands is kind of the biggest of the small group. It turns out that they got to 28% after mailing every household in the country a letter, begging people to join this organ donation program. You know the expression, “Begging only gets you so far.” It’s 28% in organ donation.

But whatever the countries on the right are doing, they’re doing a much better job than begging. So what are they doing? Turns out the secret has to do with a form at the DMV. And here is the story. The countries on the left have a form at the DMV that looks something like this. “Check the box below if you want to participate in the organ donor program.” And what happens? People don’t check, and they don’t join.

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