Skip to main content

Predictably Irrational – Dan Ariely ****

There is a certain breed of popular science book, often around the social sciences or economics that sets out to shock us by revealing that human nature doesn’t work the way we expect it to. I suppose a good example would be Freakonomics. This books is very much of that ilk, but is more based on science than the purely observational approach of Freakonomics, and manages to produce a similar level of fascination.
In a sense, although not presented as such, it’s a wholesale attack on economics as it is traditionally practised. This is, let’s face it, an easy target. I’ve never understood how economics can compare itself to real sciences, when Nobel Prizes are regularly awarded for totally opposing theories. Real science is built on observation and experiment, while economics seems more based on the Ancient Greek approach of coming up with a top-of-the-head theory to explain something, then defending it by argument.
At the core of the book’s attack is the assumption in traditional economics that human beings are rational and that we try to maximize our benefit. It is only in such circumstances that it is sensible to let the market determine anything – yet the reality (and well all know this without the experiments, but they serve to underline the situation) is that our decisions are anything but rational. We are, as the book’s title suggests, predictably irrational.
This is demonstrated with a wide range of experiments undertaken on the long suffering students of MIT and other nearby universities. (In case this suggests an economic bias, they do sometimes experiment on real human beings, as well as students.) Because this is first person stuff, there are sometimes entertaining outcomes, such as when the author, posing as a barman to study how people’s drink orders are influenced by others at the same table, is assumed to have failed in his career by an ex-colleague. But there is also a steady flow of small shocks as we realize just how irrational we are, whether we’re being unfairly influenced by initial prices (sale, anyone?) or being cured better by expensive medicine.
One side effect of reading this book is you pick up more on irrationality around you. Immediately afterwards, a friend came back from a visit to Blockbuster to rent two DVDs. He came back with four. When asked why, he pointed out that two would have cost £7.50, while four only cost £10. It was much better value for money, he argued. Yes, but he only wanted two DVDs, and he had just spent a third as much again. Yet he couldn’t see that the cunning pricing structure had forced him into irrationality.
The only trouble with a book like this is that after a while the ‘surprises’ when people act irrational are lessened because we’ve come to expect it. So it sags a little towards the end. And it’s short on answers when the author points out the negative effect of a particular irrationality, but can’t suggest any way to overcome that negative. But it’s still a very useful addition to the literature giving the general reader an understanding of why humans will never be truly rational – and why economics needs to recognize this.
Paperback:  
Also on Kindle:  
Review by Brian Clegg

Comments

Popular posts from this blog

The Great Silence – Milan Cirkovic ****

The great 20th century physicist Enrico Fermi didn’t say a lot about extraterrestrial life, but his one utterance on the subject has gone down in legend. He said ‘Where is everybody?’ Given the enormous size and age of the universe, and the basic Copernican principle that there’s nothing special about planet Earth, space should be teeming with aliens. Yet we see no evidence of them. That, in a nutshell, is Fermi’s paradox.

Not everyone agrees that Fermi’s paradox is a paradox. To some people, it’s far from obvious that ‘space should be teeming with aliens’, while UFO believers would scoff at the suggestion that ‘we see no evidence of them’. Even people who accept that both statements are true – including  a lot of professional scientists – don’t always lose sleep over Fermi’s paradox. That’s something that makes Milan Cirkovic see red, because he takes it very seriously indeed. In his own words, ‘it is the most complex multidisciplinary problem in contemporary science’.

He points out th…

The Order of Time - Carlo Rovelli ***

There's good news and bad news. The good news is that The Order of Time does what A Brief History of Timeseemed to promise but didn't cover: it attempts to explore what time itself is. The bad news is that Carlo Rovelli does this in such a flowery and hand-waving fashion that, though the reader may get a brief feeling that they understand what he's writing about, any understanding rapidly disappears like the scent of a passing flower (the style is catching).

It doesn't help either that the book is in translation so some scientific terms are mangled, or that Rovelli has a habit of self-contradiction. Time and again (pun intended) he tells us time doesn't exist, then makes use of it. For example, at one point within a page of telling us of time's absence Rovelli writes of events that have duration and a 'when' - both meaningless terms without time. At one point he speaks of a world without time, elsewhere he says 'Time and space are real phenomena.'…

The Happy Brain - Dean Burnett ****

This book was sitting on my desk for some time, and every time I saw it, I read the title as 'The Happy Brian'. The pleasure this gave me was one aspect of the science of happiness that Dean Burnett does not cover in this engaging book.

Burnett's writing style is breezy and sometimes (particularly in footnotes) verging on the whimsical. His approach works best in the parts of the narrative where he is interviewing everyone from Charlotte Church to a stand-up comedian and various professors on aspects of happiness. We get to see the relevance of home and familiarity, other people, love (and sex), humour and more, always tying the observations back to the brain.

In a way, Burnett sets himself up to fail, pointing out fairly early on that everything is far too complex in the brain to really pin down the causes of something as diffuse as happiness. He starts off with the idea of cheekily trying to get time on an MRI scanner to study what his own brain does when he's happy, b…