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Predictably Irrational Summary

About Predictably Irrational Book

  • Why do our headaches persist after taking a one-cent aspirin but disappear when we take a 50-cent aspirin?

  • Why does recalling the Ten Commandments reduce our tendency to lie, even when we couldn't possibly be caught?
  • Why do we splurge on a lavish meal but cut coupons to save twenty-five cents on a can of soup?
  • Why do we go back for second helpings at the unlimited buffet, even when our stomachs are already full?
  • And how did we ever start spending $4.15 on a cup of coffee when, just a few years ago, we used to pay less than a dollar?
  • When it comes to making decisions in our lives, we think we're in control. We think we're making smart, rational choices. But are we?

    In a series of illuminating, often surprising experiments, MIT behavioral economist Dan Ariely refutes the common assumption that we behave in fundamentally rational ways. Blending everyday experience with groundbreaking research, Ariely explains how expectations, emotions, social norms, and other invisible, seemingly illogical forces skew our reasoning abilities.

    Not only do we make astonishingly simple mistakes every day, but we make the same types of mistakes, Ariely discovers. We consistently overpay, underestimate, and procrastinate. We fail to understand the profound effects of our emotions on what we want, and we overvalue what we already own. Yet these misguided behaviors are neither random nor senseless. They're systematic and predictable—making us predictably irrational.

    From drinking coffee to losing weight, from buying a car to choosing a romantic partner, Ariely explains how to break through these systematic patterns of thought to make better decisions. Predictably Irrational will change the way we interact with the world—one small decision at a time.

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    Predictably Irrational by Dan Ariely
    Humans rarely choose things in absolute terms

    Humans rarely choose things in absolute terms

    We don't have an internal value meter that tells us how much things are worth; we mostly focus on the relative advantage of one thing over another and estimate value accordingly.

    For example, we don't know how much a six-cylinder car is worth, but we can assume it's more expensive than the four-cylinder model.)

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    Looking at things in relation to others

    We are always looking at the things around us in relation to others. We always compare jobs with jobs, vacations with vacations, lovers with lovers, and wines with wines.

    We not only tend to compare things with one another but also tend to focus on comparing things that are easily comparable—and avoid comparing things that cannot be compared easily.

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    The decoy effect

    The decoy effect

    It is a cognitive bias: we tend to have a specific change in preferences between two options when also presented with a third option that is asymmetrically dominated.

    This is the secret agent in more decisions than we could imagine. It even helps us decide whom to date—and, ultimately, whom to marry.

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    Explore the hidden forces shaping our decisions in Dan Ariely's *Predictably Irrational*.

    Topics You’ll Master Today

    Topics You’ll Master Today

    1. The Fallacy of Supply and Demand

    2. The Cost of Zero Cost

    3. The Influence of Social Norms

    4. The Power of Free!

    5. The Cost of Ownership

    6. The Effect of Expectations

    7. The High Price of Ownership

    8. Keeping Doors Open

    9. The Problem of Procrastination

    10. The Power of Price

    11. The Context of Our Decisions

    12. The Influence of Arousal

    13. The Problem of Relativity

    14. The Power of Placebo

    15. The Effect of Emotions

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    DAN ARIELY

    The first price we encounter often sets our expectations for future prices.

    DAN ARIELY

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    The Fallacy of Supply & Demand

    The Fallacy of Supply & Demand

    Ariely demonstrates how supply and demand aren’t as independent as they seem. Initial prices often anchor our perception, making us think we’re making rational choices based on value when we’re actually influenced by arbitrary starting points.

    “The first price we encounter often sets our expectations for future prices.”

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    Summary Of The Book

    Summary Of The Book

    Here's a short summary of the book. I definitely recommend a read.

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    1-Sentence Summaey

    1-Sentence Summaey

    Predictably Irrational explains the hidden forces that really drive how we make decisions, which are far less rational than we think, but can help us stay on top of our finances, interact better with others and live happier lives, once we know about them.

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    3 Mains Lessons From The Book

    3 Mains Lessons From The Book

    1. We compare whatever we can, so give others easy comparisons to pick you.

    2. Free is really just another price, but a powerful one.

    3. You overvalue what you own.

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    Con người hiếm khi lựa chọn mọi thứ một cách tuyệt đối

    Con người hiếm khi lựa chọn mọi thứ một cách tuyệt đối

    Chúng ta không có đồng hồ đo giá trị bên trong cho chúng ta biết mọi thứ đáng giá bao nhiêu; chúng ta chủ yếu tập trung vào lợi thế tương đối của thứ này so với thứ khác và ước tính giá trị tương ứng.

    Ví dụ, chúng ta không biết một chiếc xe 6 xi-lanh trị giá bao nhiêu, nhưng chúng ta có thể cho rằng nó đắt hơn so với chiếc xe 4 xi-lanh.

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    Nhìn mọi thứ trong mối quan hệ với người khác

    Nhìn mọi thứ trong mối quan hệ với người khác

    Chúng ta luôn nhìn những thứ xung quanh mình trong mối quan hệ với những người khác. Chúng ta luôn so sánh công việc với công việc, kỳ nghỉ với kỳ nghỉ, tình nhân với tình nhân, rượu với rượu.

    Chúng ta không chỉ có xu hướng so sánh mọi thứ với nhau mà còn có xu hướng tập trung vào việc so sánh những thứ dễ so sánh — và tránh so sánh những thứ không thể so sánh một cách dễ dàng.

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    Hiệu ứng chim mồi

    Hiệu ứng chim mồi

    Đó là một thành kiến về nhận thức: chúng ta có xu hướng có sự thay đổi cụ thể về sở thích giữa hai lựa chọn khi cũng có lựa chọn thứ ba bị chi phối bất đối xứng.

    Đây là tác nhân bí mật trong nhiều quyết định hơn chúng ta có thể tưởng tượng. Nó thậm chí còn giúp chúng ta quyết định hẹn hò với ai - và cuối cùng là kết hôn với ai.

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    The best thing about this book is that you keep saying to yourself, can this get any more interesting??

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