Thinking Err0rs

Seriously, there are some things you can do to figure out if you are getting pulled in a no-win battle. Just ask yourself: if I were being brought in now, would I take that project? If the answer is no, run!

If we are offered a coin toss in which we may lose $10, we will on average ask for a potential win of $20. Why is it that we are more sensitive to losses than to equivalent gains? How can we avoid making hasty, irrational decisions when we deal with an immediate loss, or the possibility of a loss?

Through many stories, it tells us how we fool ourselves. Some of the topics well known: loss aversion, value attribution, our reluctance to speak up in a group. They are told with fresh, entertaining stories. Other topics are less often covered in the context of thinking errors.

The show 60 minutes had a provocative piece on the use of fMRI to read thoughts.
The show was misleading.

Strangely, trying to remember more numbers decreases our self control. We now know why. Our prefrontal cortex, crucial to our rational decision making, can only hold a small amount of information. It roughly can hold seven plus or minus two “items” at the same time. The result: when our rational brain is busy remembering numbers, it is less able to control our emotions. We go for the fattening piece of cake.

Where does this leave us, in practical terms? While it now appears that the rational/emotional competition is an oversimplification of our decision making process, it is still a useful metaphor for improved decision making.

So, how do we know when to use our gut? Roughly speaking, if we are making comparisons based on few features, we should use our rational thinking abilities. We should analyze the available data. If there are many features, we are better off using our gut.

How does the sight of a dorsal fin in the water elicit this immediate reaction? The answer lies in auto-associative memory, the ability to recognize incomplete patterns. This skill is not limited to vision. We can hear a tune and recognize it, even if a note or two are missing. Sometimes we are so sure [...]

How does our brain create our conscious experience? What happens inside our head when we make a decision? In this video, top scientists explain their thoughts. They do this with the help of volunteers making decisions while being monitored by fMRI.   embedded by Embedded VideoYouTube DirektCurious: decisions, decisions

Our brain reacts more strongly to unexpected rewards than to those that are expected. This is what slot machines exploit. You can apply this through random, positive actions. How about sending a thank you note to a customer now?