Hello😀 Everyone!!
Today I’m going to share my thoughts and learnings on the book “Predictably irrational.”
Why this book?🤔
I’ve always been intrigued by scenarios in which people appear to be acting strangely. And the things they’re doing and the decisions they’re making don’t make any sense.
For e.g.
- People will spend 200 rupees on a pizza without hesitation, but will think long and hard before purchasing a 150 rupee course that will improve their skill.
- Purchase unnecessary items that they will never use because they were on sale.
- People feel better right away after taking medicine, but it takes a few hours for the medicine to take effect.
- A person who falls in love with someone who doesn’t care about them.
The last one applies to me as well 😛
This book called “predictably Irrational” was recommended to me for these types of questions. Dan Ariely, the author, discusses these types of scenarios in this book, and his analysis of why we do what we do is spot on.
Summary📑
Relativity in decision making
We choose one thing over another only after comparing it to something else and then making a decision. We don’t have our own value-setting mechanism. It is impossible for us to say whether a laptop is better or whether its price is justified until we see and compare what its competitors have to offer.
Even in careers, we will find that we are not sure what we want to do, but then we will find a relative or some of our friends doing something and then we want to do that.
If you want to find a date at an event, the author suggests bringing a friend who shares your basic qualities (color, body type, and face features) but is slightly less attractive than you.
Effect of word FREE!
Why do we jump for a free item even when it is not something that we really want? Because we are afraid of losing, when something is for free, we think we are winning.
Hence, zero is more than a price; it is a unique value.
And this is how advertising works, where you are asked to buy something and you are given something else for free with it. Maybe you don’t even need the original thing, but since you are getting something for free with it, you go ahead and buy that stupid fridge that has RGB lights.
Social & Market norms
We exist in two universes at the same time, one with social norms and the other with market norms. A world where volunteering for a non-profit for free is acceptable. However, if you pay a tiny sum for the same task, they will be offended. This occurs because we are attempting to combine the two universes. Working for a non-profit is a social activity, thus it’s acceptable to work for free there; yet, when you pay a tiny fee for that work, you’ve entered the market norm and in the market, it’s insulting to work for less than what you’re worth.
People are willing to work for free and they are willing to work for a reasonable wage, but offer them just a small payment and they will walk away.
Second type of dishonesty
When given the opportunity, many honest people will cheat. The cheating that they may feel is just a little bit, and hence it can be ignored. like grabbing toiletries from hotels and 3D glasses from theaters. Lying a little on their job resume etc.
They do that because they feel this is so harmless that it can be ignored, and they don’t believe that, however small it may seem, it is still dishonesty.
These are few of the ideas from the book that have stuck with me
Conclusion
To summarize, humans are irrational. Many of the things people do make no sense, and some of their actions are in direct contradiction to their beliefs.
