3 Patterns Good Thinkers Keep in Mind
Knowing when your brain lies to you is winning half the battle
|Niklas Göke||Jun 17|| 17|
Why did Albert Einstein receive a Nobel prize? Chances are, you’re now thinking of his most famous equation, e=mc². That’s special relativity.
Unfortunately, you’d be wrong. Albert Einstein received the Nobel prize for discovering the photoelectric effect. Einstein postulated that light does not only travel in wave-form but also in discrete particles — an insight that would become the foundation of quantum physics.
The reason you think Einstein won the Nobel prize for relativity theory is what Daniel Kahneman calls “the availability heuristic.” He too won a Nobel prize. One of the things he taught us is that your brain operates under the assumption that, “if you can think of it, it must be important.”
Whatever information you can first associate with a problem, question, or idea will largely determine your reaction to it. With this piece of trivia, the first thing you remember about Einstein will shape your response.
In his 2011 book, Thinking Fast and Slow, Kahneman explains the two systems in our brain — the gut and the thinker — and shows us that when the two fight each other, we become prone to false assumptions and flawed decisions.
Here are 3 lessons to keep in mind in order to make better decisions.
1. Two mental systems — one conscious, one automatic — determine your behavior.
Kahneman labels the 2 systems in your mind as follows:
System 1 is automatic and impulsive.
It’s the system you use when someone sketchy enters the train and you instinctively turn towards the door. It’s also what makes you eat the entire bag of chips in front of the TV when you just wanted to have a small bowl.
System 1 is a remnant from our past and crucial to our survival. Not having to think before jumping away from a car is quite useful, don’t you think?
System 2 is conscious, aware, and considerate.
It helps you exert self-control and focus your attention. When you try to spot a friend in a huge crowd of people, system 2 will help you recall how they look while ignoring everyone else.
System 2 is one of the most ‘recent’ additions to our brain. It’s what helps us succeed in a world where our priorities have shifted from finding food and shelter to making complex decisions.
Sadly, these two systems don’t work together in perfect unity. They often fight over who’s in charge — and this conflict determines how you’ll act and behave.
2. Intellectual errors happen when your brain tries to take shortcuts.
A baseball bat and a ball cost $1.10. The bat costs $1 more than the ball. How much does the ball cost?
What’s your instinctive answer to this question?
If it’s $0.10, I’m sorry to tell you that system 1 just tricked you. If you take some more time to think it through, you’ll see that the ball must cost $0.05. The bat costs $1 more than the ball — $1.05 — and now the sum adds up.
When system 1 faces a tough problem it can’t solve, it’ll call system 2 into action to work out the details. Your thinking slows down, and you’ll craft your response more carefully.
Often, however, your brain perceives problems as simpler than they actually are. System 1 thinks it can handle it — and you end up making a mistake.
Why does your brain do this? It wants to save energy. The law of least effort states that our minds use the minimum amount of energy for each task. Often, this causes us to not use all of our IQ points when we most need them.
So in a way, our brains limit our intelligence by being lazy.
3. Your emotions confuse you when juggling numbers.
Imagine these two scenarios:
You get $1,000. Then, you have the choice between receiving another $500 or taking a 50% gamble to win another $1,000.
You get $2,000. Then, you have the choice between losing $500 or taking a gamble with a 50% chance of losing $1,000.
Most people would take the safe $500 in the first but gamble in the second. Of course, the odds of ending up at $1,000, $1,500, or $2,000 are the same.
The reason people prefer the small, safe gain, yet take a risk to potentially not lose anything is called “loss aversion.” You’re more afraid to lose what you have than to not gain what you ultimately want.
We also perceive value based on reference points. The higher starting position at $2,000 twists your perception, and you’ll want to protect it at all costs.
Lastly, the more money we have, the less intense we feel about potential changes of similar magnitude. Losing $500 of $2,000 feels smaller than gaining $500 when you only have $1,000, so you’re more likely to gamble.
When it’s time to talk money, remember: Your emotions will confuse you. Try to get the odds into your favor, and act accordingly.
Thinking Fast and Slowshows you how two systems in your brain are constantly fighting for control over your behavior.
Here are three ways to prevent this fight from leading to errors in memory, judgment, and decisions:
Your behavior is determined by two systems in your mind — one conscious and the other automatic. Both have their uses, but they fight each other.
Your brain is lazy because it tries to conserve energy. Unfortunately, its tendency to shortcuts sometimes limits your intelligence.
As soon as numbers are involved, particularly money, switch to system 2 and try to not rely on your emotions.
“Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance.”
— Daniel Kahneman
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