The Biases in Our Thought Process

Let’s pretend one day, you decide to go to a Broadway show. Upon arrival, you realize you left your ticket at home. 

What do you do?

Another day, you decide to go to a Broadway show and are going to purchase a ticket at the counter — before realizing the money you allotted for it is gone. 

What do you do? 

According to behavioral research, the lost money for the ticket would lead you to just purchase another and attend the show. 

Leaving the ticket at home, though, would likely lead you to return home without seeing the show. 

How do we know this? Because by studying Behavioral Economics, we glean insight into how the human mind operates.

Last week, the world lost one of its foremost thinkers in Noble Prize winner Daniel Kahneman. 

Kahneman, who passed away at 90, was often credited as the father of Behavioral Economics — although he would claim he was the grandfather and that Richard Thaler was the father. 

Either way, Kahneman wrote thought-provoking books and articles on understanding human judgment and decision making. 

Along with his long-time friend and writing partner, Amos Tversky, Kahneman exposed the ingrained biases in our thought process, which often distill our judgment. 

His best-selling book, Thinking, Fast and Slow, revealed our brains have two systems of operation. The first one thinks fast, operates automatically, intuitively, involuntary and effortlessly — like when we drive, read an angry facial expression or recall our age. 

The second requires slowing down, deliberating, solving problems, reasoning, computing, focusing, concentrating, considering other data and not jumping to quick conclusions — like when we calculate a math problem, choose where to invest money or fill out a complicated form. 

The two methods within our brain conflict with one another — and Kahneman helps us understand and define the bias we didn’t even know was in our heads. 

One of the biases discussed in the book, “Representativeness,” is the intuitive leap to make judgments based on how similar something is to something we know we like.

When we evaluate another person for a job, we tend to search for similarities of those who are already preforming well to potential candidates, causing us to miss important details. Professional scouts across sports do this all the time, as they are asked, “Who does this player remind you of?”

Because they are racking their brains to draw the proper comparison, they miss the important difference, as they’re caught up in searching for similarities. 

No two players are alike, no two people are alike, and because of the inherent differences, the longer we hang onto finding similar patterns, the more likely we are to mistakenly evaluate the prospect. 

Because of his incredible work, Kahneman leaves a legacy that extends well beyond his 90 years of life. 

He touched not just those who knew him, but also those who learned from reading his narrative style of taking complex issues and making them simple. 

Business strategist Peter Strople said, “Legacy is not leaving something behind for other people. It’s leaving something behind in other people.” 

Kahneman left something in all of us. He will be greatly missed.

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