DECISIONS AND EMOTIONSit be necessary for you to turn over to test the truth of the statement?
Many people’s response is to turn over the E and to turn over the card
with the smiley face on top. But this is partly wrong. Imagine the E had a
smiley face on the other side – that is consistent with the statement, but
it doesn’t mean it is always true. Imagine too that the smiley face-up card
had a consonant on the other side – this wouldn’t prove anything. The
statement didn’t say that smiley faces only appear on the reverse of cards
with a vowel. The correct answer is to turn over the E card and the final
card with a “no-entry” sign. If there were a vowel on the back of this card
it would falsify the statement. Most get this task wrong because they look
for ways to confirm the statement rather than to falsify it.
Here are a few more of the many other heuristics that influence our
decision-making. The endowment effect describes the disproportionate
value we place on things we own. The sunk-cost fallacy describes our
anxiety to justify past investments. It explains why you’re so reluctant to
throw away that pair of shoes that you’ve only ever worn once because
they don’t fit well. Hindsight bias is our tendency to believe that things
were more obvious at the time than they really were, given what we
now know. We also tend to favour things that are more easily processed
- a phenomenon known as the fluency effect. Research has shown,
for example, that people rate hard-to-pronounce chemicals as more
dangerous and that companies with simpler names tend to fare better
on the stock market. We’re also prone to an effect known as anchoring.
If I asked you to pick a number between one hundred and one thousand
and then estimate the year the Romans left Britain, the chances are your
estimate would be biased by the random number that you chose. Shrewd
credit-card companies appear to be aware of this effect. Research has
shown that minimal payment levels (set by the company) reduce how
much some people choose to pay off each month, thus increasing the
amount of interest they end up paying to the bank.
CAN PEOPLE BE DEBIASED?
The wealth of research that’s been conducted by psychologists into the
flaws and biases in our thinking hasn’t, unfortunately, been matched
by an equivalent effort to find out how to alleviate these irrationalities.
The situation isn’t entirely without hope, however. Attempts to amelio-
rate the confirmation bias using “consider the opposite” or “consider
the alternative strategies”, for example, have met with some success, as
have “delay and reflect” advice in the context of clinicians’ diagnostic