Sunday, March 15, 2009

Why We Make Mistakes


There are many books on 'behavioral economics', but Why We Make Mistakes by a journalist is a pretty good summary. Indeed, I was looking at Ariely's Predictably Irrational, and found this book much more succinct. Fun facts from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 book:
  • There is a 1 in 1 million chance of finding a gun in an airport check
  • people don't remember names, as opposed to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 jobs or families of a person
  • 80% of calls to a corporate help desk are for lost passwords
  • Simply changing pill colors from white to red and black makes cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365m more distinctive
  • People recall cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir specific grades in school with an upward bias
  • Men report a median of 7 sex partners, women 4
  • 84% of doctors thought ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365rs were biased by self interest, whereas only 16% thought cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y were biased by self interest
  • The most common airplane accident is 'controlled flight into terrain', or flying a plane into cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ground
  • When asked to pick a movie viewed later, more choose highbrow movies; choosing movies now we choose lowbrow movies
  • being first on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ballot adds about 3% to a candidates vote
  • As something becomes familiar, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 more we tend to notice it less
  • We see things not as cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y are, but as cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y ought to be.
  • Experts make mistakes expecting patterns that aren't cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re.
  • Depressed people are realists, happy people are overconfident
  • People learn more from summaries than from reading entire chapters
  • A horse race handicapper does as well with 5 bits of information as having 10, 20, or 40, though his confidence increases with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 number of information bits available
  • Hope impedes adaptation. Someone with a potentially reversible colonostemy is more unhappy after 1 year than someone with a 1 year irreversible colonostemy.
  • When you are trying to make judgments about complex systems, things that are easily observed are overweighted.
  • Money does not improve efficiency of large organizations (ie, giving everyone more money).
  • Money does increase cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ability of individuals to withstand discomfort in tests.

4 comments:

Anonymous said...

Personally I am skeptical behavioral finance's results. Generally a lot of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 experiments seem to discount cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ability of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 subjects to learn.

Take for instance cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 overconfidence claim relating to driving ability. If most people haven't been in a serious accident, why shouldn't cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y have high expectations of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir ability? I think its a straight forward exercise in Bayesian learning. This is a good paper disputing cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "Wobegon paradox."

Anonymous said...

Men report a median of 7 sex partners, women 4

This is easily explained: women prefer promiscuous hunks to monogamous average guys. Thus some men have many partners, and plenty of men have no partners. Only cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 most disfigured of women is going to end up with no sex partner.

Dangerhorse said...

Randian has it backwards. The data could be explained by a small number of promiscuous women and a larger number of chaste women, in contrast with a population of men whose distribution of partners has lower variance.

Anyhow, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 point remains: this one is not necessarily a mistake on anyone's part.

David Foster said...

Most of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 controlled flight into terrain accidents are in instrument conditions--cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ground being flown into cannot be seen--so not as totally dumb as it may sound.