Saturday, October 09, 2010

Predictably Irrational: Dan Ariely

Picture this scenario: You walk into a McDonald's outlet, and you are hungry. You see the menu which reads, Rs. 30 for a regular burger, Rs. 45. for a medium sized burger and Rs. 52. for a large size one. What would you order? Now, obviously, you cannot gauge the extent of your hunger. And hence, you would buy the large burger, because it is highly likely that you have made the calculation that the large size burger is just Rs. 7 more than the medium sized one and you get to eat a lot more in the bargain. But did you ever realise that the medium sized burger in the menu might just be a decoy? To entice you into buying the large one? It creates an illusion that you are getting a good value for money by buying the large burger. Sounds irrational? Predictable so!!

Predictable Irrational, by Dan Ariely, describes various such social behaviours, where despite being informed and knowledgeable we make choice that cannot be justified by logic. E.g., why would it be rude and perhaps damaging, if you try to pay your mausi for the wonderful dinner she invited you for during Diwali? When, she would be elated, if you were to give her a gift like a box of sweets, which is way lesser in value compared to the 'cost' of preparation of the food. Or, do we have the capability to make the same decisions, irrespective of the state of our mind? How common is cheating? Does the fear of punishment prevent people from cheating? Or do other moral pressures work better?

Dan Ariely and his co-workers have tried to analyse these social behaviours after conducting scores of experiments in various places across in the United States. Some of the conclusions about social behaviours and decision making in the social environment are specific to the US, because of the way the society functions there. Nevertheless, the book is a wonderful read, and might be of some help to reduce our irrationality and improve decision making.

Predictably Irrational, Revised and Expanded Edition: The Hidden Forces That Shape Our DecisionsOne point to consider. Now, that I have placed a and link, to make it easy for you to buy one, if interested, would you still believe that my review of the book is impartial? Or do you think, I have some benefit in promoting this book and hence, the review need not be impartial? The first thought that you get, might be predictably irrational!!
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  1. In this connection, you may find this book interesting: Influence - Science and Practice by Robert Cialdini. If you search in google, you will be able to find a downloadable pdf, for free ofcourse.
    Now, given that this pdf is freely available may make you think that the book may not be so good. ;-)

  2. @Abhijit,
    for a fraction of a second, the thought did cross my mind. why is a free download of the book available?

    It may be worth raising a doubt, if the book is fairly new, but now-a-days, publishers stop publishing books after 3-4 years. So, may be, that is the case. Anyways, I've downloaded it and intend to begin reading sometime.