Predictably Irrational: The Hidden Forces That Shape Our Decisions
Posted by nliakos on April 30, 2013
by Dan Ariely (original publication date 2008; revised and expanded edition published in 2009; Harper-Collins)
This book has been on my to-read list for a couple of years–so when I learned that Dan Ariely, a professor of behavioral economics at Duke, was offering a massive open online course (MOOC) called “A Beginner’s Guide to Irrational Behavior,” I hastened to enroll, discovering to my dismay that it was a six-week course already in week four–or five–I’ve lost track. So quite irrationally, I decided to enroll anyway, and I also ordered Ariely’s Irrational Bundle of this and two other books for my Nook. Then I spent all of last week trying to listen to all of the lectures and take the lecture quizzes, while at the same time reading the book (mostly on the bus). Finally, this morning, I was caught up and beginning Week 6 with everyone else. (I confess I am not trying to complete the readings or the quizzes based on them or to complete the writing assignment–but since I am not looking for credit, that’s okay.) The course and the book complement and reinforce each other; they are about the same things and describe the same experiments, so I often find myself wondering if I have already read a chapter or listened to a lecture, because the material seems so familiar! Sometimes I even feel like I’ve encountered the same material three times (perhaps because I have already started the second book, The Upside of Irrationality)!
Basically, the idea is that classical or “rational” economics presumes that people make rational decisions, whereas behavioral economics presumes no such thing; as Ariely points out, our decisions are often irrational and non-intuitive. For example, we get stuff we neither want nor need if it’s free; we spend lots of money on other stuff for no good reason; we hate to lose money more than we love to get it; the higher the bonus, the worse we perform; we marry for all the wrong reasons; and so on. Some things were surprising; others were not. The book is written in a clear and interesting way. The lectures are even better! I am really enjoying the MOOC.