I was seriously shocked at some of these mistakes in thinking that I
subconsciously make all the time. Obviously, none of them are huge,
life-threatening mistakes, but they are really surprising and avoiding them
could help us to make more rational, sensible decisions.
Being aware of the mistakes we naturally have in our thinking can make a big
difference in avoiding them. Unfortunately, most of these occur subconsciously,
so it will also take time and effort to avoid them—if you even want to.
Regardless, I think it’s fascinating to learn more about how we think and
make decisions every day, so let’s take a look at some of these thinking habits
we didn’t know we had.
1. We surround ourselves with information that matches our beliefs
We tend to like people who think like us. If we agree with someone’s beliefs,
we’re more likely to be friends with them. While this makes sense, it means
that we subconsciously begin to ignore or dismiss anything that threatens our
world views, since we surround ourselves with people and information that
confirm what we already think.
This is called confirmation bias. If you’ve ever heard of the frequency
illusion, this is very similar. The frequency illusion occurs
when you buy a new car, and suddenly you see the same car everywhere. Or when a
pregnant woman suddenly notices other pregnant women all over the place. It’s a
passive experience, where our brains seek out information that’s related to us,
but we believe there’s been an actual increase in the frequency of those
Confirmation bias is a more active form of the same experience. It happens
when we proactively seek out information that confirms our existing beliefs.
Not only do we do this with the information we take in, but we approach our
memories this way, as well. In an experiment in 1979 at the
University of Minnesota, participants read a story about a women
called Jane who acted extroverted in some situations and introverted in others.
When the participants returned a few days later, they were divided into two
groups. One group was asked if Jane would be suited to a job as a librarian,
the other group were asked about her having a job as a real-estate agent. The
librarian group remembered Jane as being introverted and later said that she
would not be suited to a real-estate job. The real-estate group did the exact
opposite: they remembered Jane as extroverted, said she would be suited to a
real-estate job and when they were later asked if she would make a good
librarian, they said no.
In 2009, a study at Ohio
State showed that we will spend 36 percent more time reading an
essay if it aligns with our opinions.
Whenever your opinions or beliefs are so intertwined with your self-image you
couldn’t pull them away without damaging your core concepts of self, you avoid
situations which may cause harm to those beliefs. – David
This trailer for David McRaney’s book, You are Now Less Dumb, explains this
concept really well with a story about how people used to think geese grew on
trees (seriously), and how challenging our beliefs on a regular basis is the
only way to avoid getting caught up in the confirmation bias:
2. We believe in the “swimmer’s body” illusion
This has to be one of my favorite thinking mistakes I came across. In Rolf
Dobelli’s book, The Art of Thinking
Clearly, he explains how our ideas about talent and extensive
training are well off-track:
Professional swimmers don’t have perfect bodies because they train
extensively. Rather, they are good swimmers because of their physiques. How
their bodies are designed is a factor for selection and not the result of their
The “swimmer’s body illusion” occurs when we confuse selection
factors with results. Another good example is top performing
universities: are they actually the best schools, or do they choose the best
students, who do well regardless of the school’s influence?
What really jumped out at me when researching this section was this
particular line from Dobelli’s book:
Without this illusion, half of advertising campaigns would not
It makes perfect sense, when you think about it. If we believed that we were
predisposed to be good at certain things (or not), we wouldn’t buy into ad
campaigns that promised to improve our skills in areas where it’s unlikely we’ll
3. We worry about things we’ve already lost
No matter how much I pay attention to the sunk cost fallacy, I still
naturally gravitate towards it.
The term sunk cost refers to any cost (not just monetary,
but also time and effort) that has been paid already and cannot be recovered.
So, a payment of time or money that’s gone forever, basically.
The reason we can’t ignore the cost, even though it’s already been paid, is
that we wired to feel loss far more strongly than gain. Psychologist Daniel
Kahneman explains this in his book, Thinking Fast and
Organisms that placed more urgency on avoiding threats than they did on
maximizing opportunities were more likely to pass on their genes. So, over time,
the prospect of losses has become a more powerful motivator on your behavior
than the promise of gains.
The sunk cost fallacy plays on this tendency of ours to emphasize loss over
gain. This research study is a great example of how it works:
Hal Arkes and Catehrine Blumer created an experiment in 1985 which
demonstrated your tendency to go fuzzy when sunk costs come along. They asked
subjects to assume they had spent $100 on a ticket for a ski trip in Michigan,
but soon after found a better ski trip in Wisconsin for $50 and bought a ticket
for this trip too. They then asked the people in the study to imagine they
learned the two trips overlapped and the tickets couldn’t be refunded or resold.
Which one do you think they chose, the $100 good vacation, or the $50 great
Over half of the people in the study went with the more expensive trip.
It may not have promised to be as fun, but the loss seemed
So, just like the other mistakes I’ve explained in this post, the sunk cost
fallacy leads us to miss or ignore the logical facts presented to us, and
instead make irrational
decisions based on our emotions—without even realizing we’re
The fallacy prevents you from realizing the best choice is to do whatever
promises the better experience in the future, not which negates the feeling of
loss in the past.
Being such a subconscious reaction, it’s hard to avoid this one. Our best bet
is to try to separate the current facts we have from anything that happened in
the past. For instance, if you buy a movie ticket only to realize the movie is
terrible, you could either:
a) stay and watch the movie, to “get your money’s worth” since you’ve already
paid for the ticket (sunk cost fallacy)
b) leave the cinema and use that time to do something you’ll actually
The thing to remember is this: you can’t get that investment back. It’s gone.
Don’t let it cloud your judgement in whatever decision you’re making in this
moment—let it remain in the past.
4. We incorrectly predict odds
Imagine you’re playing Heads or Tails with a friend. You flip a coin, over
and over, each time guessing whether it will turn up heads or tails. You have a
50/50 chance of being right each time.
Now suppose you’ve flipped the coin five times already and it’s turned up
heads every time. Surely, surely, the next one will be tails,
right? The chances of it being tails must be higher now, right?
Well, no. The chances of tails turning up are 50/50. Every time. Even if you
turned up heads the last twenty times. The odds don’t change.
The gambler’s fallacy is a glitch in our
thinking—once again, we’re proven to be illogical creatures. The
problem occurs when we place too much weight on past events, believing that
they will have an effect on future outcomes (or, in the case of Heads or Tails,
any weight, since past events make absolutely no difference to the
Unfortunately, gambling addictions in particular are also affected by a
similar mistake in thinking—the positive expectation bias. This is when we
mistakenly think that eventually, our luck has to change for the better.
Somehow, we find it impossible to accept bad results and give up—we often insist
on keeping at it until we get positive results, regardless of what the odds of
that happening actually are.
5. We rationalize purchases we don’t want
I’m as guilty of this as anyone. How many times have you gotten home after a
shopping trip only to be less than satisfied with your purchase decisions and
started rationalizing them to yourself? Maybe you didn’t really want it after
all, or in hindsight you thought it was too expensive. Or maybe it didn’t do
what you hoped, and was actually useless to you.
Regardless, we’re pretty good at convincing ourselves that those flashy,
useless, badly thought-out purchases are necessary after all. This is known as
post-purchase rationalization or Buyer’s Stockholm
The reason we’re so good at this comes back to psychology:
Social psychologists say it stems from the principle of commitment, our
psychological desire to stay consistent and avoid a state of cognitive
Cognitive dissonance is
the discomfort we get when we’re trying to hold onto two competing ideas or
theories. For instance, if we think of ourselves as being nice to strangers,
but then we see someone fall over and don’t stop to help them, we would then
have conflicting views about ourselves: we are nice to strangers, but we
weren’t nice to the stranger who fell over. This creates so much discomfort
that we have to change our thinking to match our actions—i.e. we start
thinking of ourselves as someone who is not nice to strangers, since
that’s what our actions proved.
So in the case of our impulse shopping trip, we would need to rationalize the
purchases until we truly believe we needed to buy those things, so that our
thoughts about ourselves line up with our actions (making the purchases).
The tricky thing in avoiding this mistake is that we generally act before we
think, leaving us to rationalize our actions afterwards.
Being aware of this mistake can help us avoid it by predicting it before
taking action—for instance, as we’re considering a purchase, we often know that
we will have to rationalize it to ourselves later. If we can recognize this,
perhaps we can avoid it. It’s not an easy one to tackle, though!
6. We make decisions based on the anchoring effect
Dan Ariely is a behavioral economist who gave one of my favorite TED
talks ever about the irrationality of the human brain when it
comes to making decisions.
He illustrates this particular mistake in our thinking superbly, with
multiple examples. The anchoring effect essentially works like this: rather than
making a decision based on pure value for investment (time, money, etc.), we
factor in comparative value—that is, how much value an option offers when
compared to another option.
Let’s look at some examples from Dan, to illustrate this effect in
One example is an experiment that Dan
conducted using two kinds of chocolates for sale in a booth:
Hershey’s Kisses and Lindt Truffles. The Kisses were one penny each, while the
Truffles were fifteen cents each. Considering the quality differences between
the two kinds of chocolates and the normal prices of both items, the Truffles
were a great deal, and the majority of visitors to the booth chose the
For the next stage of his experiment, Dan offered the same two choices, but
lowered the prices by one cent each. So now the Kisses were free, and the
Truffles cost fourteen cents each. Of course, the Truffles are even more of a
bargain now, but since the Kisses were free, most people chose those
Your loss aversion system is always vigilant, waiting on standby to keep you
from giving up more than you can afford to spare, so you calculate the balance
between cost and reward whenever possible. – You Are Not So
Another example Dan offers in his TED talk is when consumers are given
holiday options to choose between. When given a choice of a trip to Rome, all
expenses paid, or a similar trip to Paris, the decision is quite hard. Each city
comes with its own food, culture and travel experiences that the consumer must
When a third option is added, however, such as the same Rome trip, but
without coffee included in the morning, things change. When the
consumer sees that they have to pay 2,50 euros for coffee in the third trip
option, not only does the original Rome trip suddenly seem superior out of
these two, it also seems superior to the Paris trip. Even
though they probably hadn’t even considered whether coffee was included or not
before the third option was added.
Here’s an even better example from another of Dan’s experiments:
Dan found this real ad for subscriptions to The Economist, and used it to see
how a seemingly useless choice (like Rome without coffee) affects our
To begin with, there were three choices: subscribe to The Economist web
version for $59, the print version for $125, or subscribe to both the print and
web versions for $125. It’s pretty clear what the useless option is here. When
Dan gave this form to 100 MIT students and asked them which option they would
choose, 84% chose the combo deal for $125. 16% chose the cheaper, web-only
option, and nobody chose the print-only option for $125.
Next, Dan removed the ‘useless’ print-only option which nobody wanted and
tried the experiment with another group of 100 MIT students. This time, the
majority chose the cheaper, web-only version, and the minority chose the combo
deal. So even though nobody wanted the bad-value $125 print-only option, it
wasn’t actually useless—in fact, it actually informed the decisions people made
between the two other options by making the combo deal seem more
valuable in relation.
This mistake is called the anchoring
effect, because we tend to focus on a particular value and
compare it to our other options, seeing the difference between values rather
than the value of each option itself.
Eliminating the ‘useless’ options ourselves as we make decisions can help us
choose more wisely. On the other hand, Dan says that a big part of the problem
comes from simply not knowing our own preferences very well, so perhaps that’s
the area we should focus on more, instead.
7. We believe our memories more than facts
Our memories are highly fallible and plastic. And yet, we tend to
subconsciously favor them over objective facts. The availability heuristic is a
good example of this. It works like this:
Suppose you read a page of text and then you’re asked whether the page
includes more words that end in “ing” or more words with “n” as the second-last
letter. Obviously, it would be impossible for there to be more “ing” words than
words with “n” as their penultimate letter (it took me a while to get that—read
over the sentence again, carefully, if you’re not sure why that
is).However, words ending in “ing” are easier to recall than words like
hand, end, or and, which have “n” as their second-last letter, so we would
naturally answer that there are more “ing” words.
What’s happening here is that we are basing our answer of probability (i.e.
whether it’s probable that there are more “ing” words on the page) on how
available relevant examples are (i.e. how easily we can recall them).
Our troubles in recalling words with “n” as the second last letter make us
think those words don’t occur very often, and we subconsciously ignore the
obvious facts in front of us.
Although the availability heuristic is a natural process in how we think, two Chicago
scholars have explained how wrong it can be:
Yet reliable statistical evidence will outperform the availability heuristic
The lesson here? Whenever possible, look at the facts. Examine the data.
Don’t base a factual decision on your gut instinct without at least
exploring the data objectively first.
8. We pay more attention to stereotypes than we think
The funny thing about lots of these thinking mistakes is that they’re so
ingrained, I had to think long and hard about why they’re mistakes at all! This
one is a good example—it took me a while to understand how illogical this
pattern of thinking is.
It’s another one that explains how easily we ignore actual facts:
The human mind is so wedded to stereotypes and so distracted by vivid
descriptions that it will seize upon them, even when they defy logic, rather
than upon truly relevant facts.
Here’s an example to illustrate the mistake, from researchers Daniel Kahneman
and Amos Tversky:
In 1983 Kahneman and Tversky tested how illogical human thinking is by
describing the following imaginary person:
Linda is thirty-one years old, single, outspoken, and very bright. She
majored in philosophy. As a student, she was deeply concerned with issues of
discrimination and social justice, and also participated in antinuclear
The researchers asked people to read this description, and then asked them to
answer this question:
Which alternative is more probable
- Linda is a bank teller.
- Linda is a bank teller and is active in the feminist movement.
Here’s where it can get a bit tricky to understand (at least, it did for
me!)—If answer #2 is true, #1 is also true. This means that #2 cannot
be the answer to the question of probability.
Unfortunately, few of us realize this, because we’re so overcome by the more
detailed description of #2. Plus, as the earlier quote pointed out, stereotypes
are so deeply ingrained in our minds that subconsciously apply them to
Roughly 85% of people chose option #2 as the answer.
Again, we see here how irrational and illogical we can be, even when the
facts are seemingly obvious.
I love this quote from researcher Daniel Kahneman on the differences between
economics and psychology:
I was astonished. My economic colleagues worked in the building next door,
but I had not appreciated the profound difference between our intellectual
worlds. To a psychologist, it is self-evident that people are neither fully
rational nor completely selfish, and that their tastes are anything but
Clearly, it’s normal for us to be irrational and to think illogically, even
though we rarely realize we’re doing it. Still, being aware of the pitfalls we
often fall into when making decisions can help us to at least recognize them, if
not avoid them.
Have you come across any other interesting mistakes we make in the way we
think? Let us know in the comments.
Source: www.BusinessInsider.com / Follow @ThatRossBoss
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