Tuesday, February 23, 2016

Lessons from Predictably Irrational

  1. The Truth about Relativity: Why Everything Is Relative—Even When It Shouldn't Be
    1. Our mind is relative-oriented. Thus, we always try to based on something to make a decision.
  2. The Fallacy of Supply and Demand: Why the Price of Pearls—and Everything Else— Is Up in the Air
    1. The demand is controlled by the perception of value.
  3. The Cost of Zero Cost: Why We Often Pay Too Much When We Pay Nothing
    1. When we get a zero cost thing we felling an obligation to pay for that in somehow.
  4. The Cost of Social Norms: Why We Are Happy to Do Things, but Not When We Are Paid to Do Them
    1. The best rule. We living in two worlds: social and market. If we tryed to pay something social using a market system, probably we will have a problem.
  5. The Influence of Arousal: Why Hot Is Much Hotter Than We Realize
    1. Try to relax and do not make decision when you are in arousal state. The market of sex is based on this rule
  6. The Problem of Procrastination and Self-Control: Why We Can't Make Ourselves Do What We Want to Do
    1. Restricting our freedom (equally spaced deadlines) is the best cure for procrastination.
  7. The High Price of Ownership: Why We Overvalue What We Have
    1. We still believed that in general the ownership of something increases its value in the owner's eyes
  8. Keeping Doors Open: Why Options Distract Us from Our Main Objective
    1. In the context of today's world, we work just as feverishly to keep all our options open. Given a simple setup and a clear goal (in this case, to make money), all of us are quite adept at pur­ suing the source of our satisfaction, or, get many options
  9. The Effect of Expectations: Why the Mind Gets What It Expects
    1. When we believe beforehand that something will be good, therefore, it generally will be good—and when we think it will be bad, it will bad. 
  10. The Power of Price: Why a 50-Cent Aspirin Can Do What a Penny Aspirin Can't
    1. We still believe that a expensive goods is better rather than a cheap goods.
  11. The Context of Our Character, Part I: Why We Are Dishonest, and What We Can Do about It
    1. Our honesty monitor is a quite flexible, adapting on our culture, and our decisions about honesty is based on a cost/benefit analysis.
  12. The Context of Our Character, Part II: Why Dealing with Cash Makes Us More Honest
    1. The days of cash are coming to a close. Cash is a drag on the profits of banks—they want to get rid of it. On the other hand, electronic instruments are very profitable. 
  13. Beer and Free Lunches: What Is Behavioural Economics, and Where Are the Free Lunches?
    1. As long as these mechanisms provide more benefits than costs, we should consider them to be free lunches—mechanisms that provide net benefits to all parties.

Once we understand when and where we may make errone­ ous decisions, we can try to be more vigilant, force ourselves to think differently about these decisions, or use technology to overcome our inherent shortcomings. 

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