Think It Possible That You May Be Mistaken?

The Story of the Choices We Make

A modern view of the Mechanics of Choices

Amos Tversky, a mathematical psychologist, and Daniel Kahneman, a psychologist and economist, did seminal work on how we make choices. Before their work, psychologists mostly came up with stories on human behavior that had a scant experimental basis. On the other hand, economists held rigidly to the belief that humans make rational, calculated decisions to maximize their utility.

Tversky and Kahneman invented several interesting experiments that showed that humans were reliably biased towards making decisions in a particular manner that was often not consistent with the maximization of utility.

There is now a large amount of work done, based on rigorously done experiments, that show a range of human biases. Studies also show that the biases we are affected by change as we move through life from childhood, adolescence, and older ages — with a greater and deeper type of biases as we become older! One of the most pernicious of biases is Overconfidence.

Overconfidence

Kahneman posited that Overconfidence occurs because “when we estimate a quantity, we rely on information that comes to mind and construct a story. Allowing for the information that does not come to mind is impossible.”

Kahneman writes that “Overconfidence also appears to be endemic in medicine. A study of patients who died in the ICU compared autopsy results with the diagnosis that physicians had provided while the patients were alive. Clinicians who were ‘completely certain’ of the diagnosis were wrong 40% of the time.”

In business, when one honestly acknowledges that one is not sure and that there is uncertainty inherent in one’s advice, clients often look elsewhere for an “expert” who will confidently give them a “solution.” When events turn out differently, there are always a number of reasons that can be invented as to why the outcome differed from what the expert predicted.

Desert Island Decision Processes

Of interest in this brief essay is what one can call the Desert Island Decision Process. Imagine you are told that you will be stranded on an uninhabited desert island. The island is not dangerous, and food and shelter are easily available. You can take one person with you. The person can be selected from the past (and magically brought to life) or present. Who would you choose?

I did a quick ask-around of my contacts. I know this cannot make up a rigorous survey. For one, when I asked people, I know their answers may have been affected by the fact of our acquaintance. The survey needs to be anonymous. Second, different types of people may answer in different ways (for example, married / unmarried, young/old might answer differently). Third, we need a large enough sample. There are several other factors one would have to take into consideration when doing such an exercise in a rigorous manner.

A flavor of some of the answers were historical figures, spouses, children, parents. One person said they preferred to be alone. Two of the twenty-five people I asked selected close friends with whom they were not related.

However, the primary reason for my questioning was not the answers per se. My aim was to try and discern if there was an attempt to list out criteria or whether answers came “from the gut” and to see how sure people were in the answers they gave.

I did not give the people much time to answer, so perhaps I inadvertently “pushed” people towards answering “without thought.” But, after each one answered, I then asked, “are you sure? You can pick anyone from all of history.” Only two of the twenty-five I asked were a little unsure before answering. One of the twenty-five changed the decision (but was then sure of the final answer), and only one was still uncertain after answering. The others were quick and certain in their response. They were adamant that they had responded well and that the person they selected (only one chose to be alone) was the best person for them to have with them on a desert island.

There may be many errors in my approach. However, what I probably saw is that people answered using what Kahneman describes as our System 1 process. System 1 and System 2 are metaphors Kahneman uses to describe two modes of thinking and reacting to situations:

“System 1 operates automatically and quickly, with little or no effort and no sense of voluntary control.

System 2 allocates attention to the effortful mental activities… including complex computations.”

In answering with System 1 most of the people were confident their choice was right for them. This, even though none of them tried to lay out criteria or analyze what might make them happy with a certain type of companion on this desert island.

Important Decisions for Your Ten Year Older Self

Kahneman quotes the comedian Danny Kane who “speaking of a woman he disliked, said, ‘Her favorite position is beside herself, and her favorite sport is jumping to conclusions.’ [This] offers an apt description of how System 1 functions. Jumping to conclusions is efficient if the conclusions are likely to be correct and the costs of an occasional mistake acceptable. Doubt is not in the repertoire of System 1. Uncertainty and doubt are the domain of System 2.”

We are, writes Kahneman, a “machine for jumping to conclusions,” and having decided on a certain path, we are then usually supremely sure of ourselves.

Making better decisions is not just a matter of investing and business purposes. It is vital for our own personal well-being. Are the decisions you make today the right ones for your ten-year older self. If you look back on your life and see the major, life-affecting decisions your ten-year younger self took, were they wise? Did your ten-year younger self examine all the options and was this younger self-aware of the person you might have turned out as?

Of course, chance plays a role in any outcome. Coping with noise and discerning a signal is always a challenge. However, the way to mitigate risks and increase chances of success seems to be to pause before making a major decision. Think through and analyze. Work out probabilities and evaluate many options, only then move forward. There is still no certainty you have chosen the best way forward, however the direction you take may be better than if you selected by System 1. Uncertainties also mean that one might still keep an open mind about the possibility that a better route is available.

One of the best hires I ever made was of a person who, when asked a tough question in the interview, said to me, “Please could you wait a short while. I want to think about the answer.” Some people I interviewed did take their time and then answered carefully, but none of them did what this person did, admitting more time was required.

Living with Uncertainty

Theocrats and ideologues are always so sure. Many are also willing to do the ultimate harm to others and themselves for a “cause.” This often goes beyond the mere bias of overconfidence, and I can only imagine it as a disease of the mind.

Those with a scientific-humanist bent of mind identify with what Oliver Cromwell wrote to the General Assembly of the Church of Scotland: “I beseech you, in the bowels of Christ, think it possible that you may be mistaken.”

When faced with a major decision, I now ask myself Oliver Cromwell’s question. I then attempt to reason out alternatives carefully before proceeding to take action (or not take any action). Perhaps, dear reader, you might find such an approach useful as well.