Product Description

Why do smart people make irrational decisions every day? The answers will surprise you. Predictably Irrational is an intriguing, witty and utterly original look at why we all make illogical decisions. Why can a 50p aspirin do what a 5p aspirin can't? If an item is "free" it must be a bargain, right? Why is everything relative, even when it shouldn't be? How do our expectations influence our actual opinions and decisions? In this astounding book, behavioural economist Dan Ariely cuts to the heart of our strange behaviour, demonstrating how irrationality often supplants rational thought and that the reason for this is embedded in the very structure of our minds. Predicatably Irrational brilliantly blends everyday experiences with a series of illuminating and often surprising experiments, that will change your understanding of human behaviour. And, by recognising these patterns, Ariely shows that we can make better decisions in business, in matters of collective welfare, and in our everyday lives from drinking coffee to losing weight, buying a car to choosing a romantic partner.

Product Details

• Amazon Sales Rank: #1161 in Books
• Published on: 2009-03-05
• Original language: English
• Binding: Paperback
• 304 pages

Review
'For anyone interested in marketing - either as a practioner or victim - this is unmissable reading. If only more researchers could write like this, the world would be a better place.' Financial Times 'A marvelous book that is both thought provoking and highly entertaining, ranging from the power of placebos to the pleasures of Pepsi. Ariely unmasks the subtle but powerful tricks that our minds play on us, and shows us how we can prevent being fooled.' Jerome Groopman, New York Times bestselling author of How Doctors Think 'PREDICTABLY IRRATIONAL is wildly original. It shows why--much more often than we usually care to admit--humans make foolish, and sometimes disastrous, mistakes. Ariely not only gives us a great read; he also makes us much wiser.' George Akerlof, Nobel Laureate in Economics, 2001 Koshland Professor of Economics, University of California at Berkeley "Predictably Irrational is a charmer -- filled with clever experiments, engaging ideas, and delightful anecdotes. Dan Ariely is a wise and amusing guide to the foibles, errors, and bloopers of everyday decision-making." -- Daniel Gilbert, Professor of Psychology, Harvard University and author of Stumbling on Happiness "Predictably Irrational is going to be the most influential, talked-about book in years. It is so full of dazzling insights -- and so engaging -- that once I started reading I couldn't put it down." -- Daniel McFadden, Nobel Laureate in Economics, 2000 Morris Cox Professor of Economics, University of California at Berkeley "Dan Ariely's ingenious experiments explore deeply how our economic behaviour is influenced by irrational forces and social norms. In a charmingly informal style that makes it accessible to a wide audience, Predictably Irrational provides a standing criticism to the explanatory power of rational egotistic choice." -- Kenneth Arrow, Nobel Laureate in Economics 1972, Professor of Economics Stanford University. "A delightfully brilliant guide to our irrationality -- and how to overcome it - in the marketplace and everyplace." -- Geoffrey Moore, author of Crossing the Chasm and Dealing with Darwin "After reading this book, you will understand the decisions you make in an entirely new way." -- Nicholas Negroponte, founder of MIT's Media Lab and founder and chairman of the One Laptop per Child non-profit association. "This entertaining yet brilliant book helps us recognize the foibles that underlie the decisions we make in our life -- large and small, profound and banal. More than just pointing our mistakes, Ariely helps us understand and appreciate the complex beauty of human nature. It's nothing less than a witty survival manual for the early 21st century." -- David A. Ross Director emeritus, San Francisco Museum of Modern Art and Director emeritus, Whitney Museum of American Art "Dan Ariely is a genius at understanding human behaviour: no economist does a better job of uncovering and explaining the hidden reasons for the weird ways we act, in the marketplace and out. Predictably Irrational will reshape the way you see the world, and yourself, for good." -- James Surowiecki, author of The Wisdom of Crowds "Predictably Irrational is a solidly scientific, eminently readable, and remarkably insightful look into why we do what we do every day ! and why it's so hard to change, even when we 'know better.'" -- Wenda Harris Millard, President, Media, Martha Stewart Living Omnimedia "One of the best books this year, or any year. A towering contribution that helps us better understand how much un-thinking we do most of the time, and how to counteract it. Everyone who has to make decisions (and has to deal with decisions of others) must read this book." -- Alan Kay, President of Viewpoints Research, winner of the Turing, Draper, and Kyoto Prizes

Charles Schwab, Chairman and CEO, The Charles Schwab Corporation
"The most difficult part of investing is managing your emotions. Dan explains why that is so challenging for all of us, and how recognizing your built-in biases can help you avoid common mistakes."

Jerome Groopman, Recanati Chair of Medicine, Harvard Medical School,and New York Times bestselling author of How Doctors Think
"A marvelous book that is both thought-provoking and highly entertaining, ranging from the power of placebos to the pleasures of Pepsi. Ariely unmasks the subtle but powerful tricks that our minds play on us, and shows us how we can prevent being fooled."

Customer Reviews

Don't be put off by the words "business" or "economics"
This is really a popular psychology book about how we behave and how, as the subtitle puts it, hidden forces influence our everyday decisions. So don't be put off by quotes from businessmen and economists in the blurb. I almost was. But I'm glad I wasn't. This is a neat little book with plenty of nuggets of information and insights that you can put to use immediately. You learn things about yourself and other people that seem so obvious you wonder how you'd never noticed them before and you learn why hunches you've had in the past really are right. Each chapter of this book consists of some simple experiments that are designed to probe a different aspect of our decision-making process e.g. how our expectations affect how we experience things and why too many choices can be unhelpful, to mention just two. The experiments are simple and elegant.

They usually consist of asking two or more differently informed groups of students questions about something. Actually, sometimes the author is a bit vague about the exact experimental conditions, how bias was eliminated from the experiment (particularly with respect to how questions were framed [what language was used] and how the participants were chosen [a few samples were decidedly small]) and how the many variables were isolated and controlled. So in that sense we must take Ariely's word for it. Also, he often vaguely summarises the results of these experiments with words such as "more than" and "most" instead of giving figures. If he were giving a lecture I would have asked him to clarify quite a few points. But all in all I think that this was an interesting book albeit a short one. It is a slim volume and the typeface is quite large. I'm a slow reader and I read it comfortably over two days.

Interesting, but narrow in scope
The field of behavioural economics is a fascinating one, which has already brought us the wonderful 'Freakonomics'. By comparison to that book this one suffers somewhat, because:

(1) There is an unremitting US-centricity here. All the examples and experiments are about typically US topics, all the conclusions are spelled out in a US context.

(2) The findings are often used as a launching point for some thoroughly unscientific moralising about how society ought to act differently.

(3) The experiments all seem rather narrow in scope. None is repeated and all seem to run on a rather small scale. It seems that as soon as one experiment throws light on a curious behaviour, it is time to move on to the next. I suspect the writers of 'Freakonomics' might have found more data to explore more fully aspects of the behaviour each time.

I was also annoyed by several chapters containing an appendix which appears right after the chapter, rather than all residing at the end.

On the plus side, Ariely writes engagingly and describes the experiments with a fair amount of humour. I paricularly enjoyed his descriptions of the experiment testing the effect of arousal on judgment.

Useful route into behavioural economics
I bought this having seen Dan Ariely speak at LSE recently. He was an engaging speaker and his research sounded interesting.

Having read the book I was left a bit underwhelmed, because I found that I was already familar with both some of the research and a number of the concepts, and was tempted to give it 3 stars. However on reflection that's probably a bit unfair. This is actually a good book for people interested in learning about the field of behavioural economics. It's nicely written with a chatty style, and some of Ariely's research is very interesting.

Just a few snapshots to give you an idea of what this book covers. He looked at subscription packages for The Economist and found that and obviously bad deal led people to choose an option that was like it but obviously better (because it gave them a way to measure the options). In contrast when there were two options that were different but hard to compare they tended to just go for the cheap option.

In a maths test where subjects were given a cash reward based on the number of problems solved and were given an opportunity to cheat, he found that asking them to recall the Ten Commandments ahead of the test appeared to make them less likely to be dishonest.

And in taste tests people prefer Pepsi to Coke when tasting blind, but prefer Coke to Pepsi when they know in advance when they know what they are going to drink. This suggests that we prime ourselves to enjoy something we expect to enjoy.

If this all sounds 'obvious' to you, to some extent you are right (although there are many examples in this field that are counterintuitive). But people like Ariely make the point that although in a 'common sense' way we know that we are easily influenced and 'irrational', policy is often still made with the assumption in mind that we behave as rational self-maximising economic agents.

One point that can be, and often is, made in return is that although behavioural economics is good at describing seemingly irrational behaviour, it is yet to prove itself as a useful resource for designing better policy (although opt-out, rather than opt-in, approaches to both pension saving and organ donation are arguably influenced by behavioural insights). And in fact Ariely's book is at its weakest when he tries to suggest ways that his research findings might inform policy (I'm not surprised that the bank didn't call him back about his credit card idea!).

So for someone such as me interested in policy the book is enjoyable, but a bit limited in value. However if you are new to this field and interested in finding out more this is a good starting place, and you may well find yourself surprised by some of the findings.