*Disclaimer: The following is a summary and/or review based on the authors understanding of the book. Also, a note on the grammatical error in the title – it should have been “a peek into the human rationale” to comply with tense and subject-predicate norms .
A friend once told me that the Irish dictionary does not have the word gullible; however, all humans fall for various thinking biases and logical fallacies, making obvious errors in their judgements. And his previous book Predictable Irrational that narrates the fallibility of our human thought process, this book narrates the thinking biases and logical fallacies through real world experiments.
It begins by exploring the shortcomings of incentive and bonus structures that are supposed to improve performance but often fail to do so. Rather than learning the statistics of quartile rule for incentives, understanding the basis of irrationality is much more helpful for HR managers. Although productivity increases with incentives initially, incentives tends to be counter-productive beyond certain point.
And at a certain point work is no longer about the monetary rewards. Although we believe that not everyone works for money, it turns out that most do NOT work for money. Although an intrinsic meaning of work, relating to a higher sense of purpose, would be the ultimate motivation, at minimum the absence of satisfaction, purpose, and utility of one’s work can be significantly de-motivating.
Finally moving to the biases, Dan introduces us to the IKEA effect to help us understand how DIY instills sense of ownership. Even basic effort such as that involved in assembling LEGO or Ready-mix cake, and small logical leaps in completing ideas can cultivate ownership. And this ownership drives strong affinity, with examples of founders obsessed with their ideas as well as Edison rejecting AC (Alternating Current) for not being invented at his lab.
Then the book moves on to our hedonic tendencies narrating the psychological tendencies that make us seek justice or revenge. The power of the desire for vengeance, makes us shrug logic aside and make rather irrational decisions in seemingly trivial situations. This highlights not only the importance of fair trials and justice but also how our hedonic tendencies hijack our thought process (amygdala hijack) causing long-term impacts through myopic response.
It then explores our ability to adopt to context whether your salary, lifestyle, or spouse. Over time, as your mind get used to a level of comfort, lifestyle adapts to salary, threshold of frustration adjusts to the frequency of breaks. And once such frequency increases, any decrease becomes unacceptable, causing severe dissatisfaction.
And finally it ends with the discussion of how dating applications and charities have accommodated our irrational thought process to make their campaigns more effective. Using the example of dating markets, the author narrates how an individual sense of beauty adjusts to own reference points. Whereas, using example of charity advertisements the author highlights how human emotions spike and respond to specific cases more than to any generalised cause.
Overall this is an insightful book worth reading, and given the lucid nature of narratives that excludes the statistics required to establish correlations, you will enjoy reading this book. And if you are interested in behavioural science or finance, this is a must read.
You can read this book or continue to believe that you’re invincible!
Header Image Photo by Joakim Honkasalo on Unsplash
Savvy Munshi 