Behaviouronomics

There is difference between how you believe you will act under certain circumstances and how you actually act when the time comes. When asked in the cold light of day how we will behave in the future, we turn out to be very bad at imagining how we will act in the heat of the moment.

Remember the mental model called Curse of Knowledge? I had written about in in Latticework series sometime back. If you can’t recall, let me refresh your memory. ‘Curse of knowledge’ says that better-informed people find it extremely difficult to think about problems from the perspective of lesser-informed people. In other words, the more knowledgeable you are about a subject, the more unnatural it becomes for you to communicate that knowledge in a simple and clear way. That’s why effective teaching is such a difficult task. Being knowledgeable about something doesn’t ensure that you can teach it effectively.

Curse of knowledge isn’t just limited to knowledge. It’s equally applicable to emotions. Being in a calm state, it’s not easy to relate to the actions of another person who is in an emotionally high state. That’s the genesis of the idea called empathy, which is the ability to relate to another person whose emotions are reaching a boiling point. However, putting yourself in other’s shoes is easier said than done. It’s a challenge and very few people possess the talent to practice empathy.

[Read more…] about Behaviouronomics: Empathy Gap

When we put a lot of energy into a task, we tend to overvalue the outcome. As a result, we become attached to things that we invest effort in creating. It’s a very dangerous behavioural bias because it lets us fool ourselves.

In July 1999, I entered my engineering college campus for the first time with a lot of excitement and a bit of trepidation too. I was excited about my new-found freedom. At the same time, I was scared to death about the college ragging. For those who don’t know, ragging in India is a damaging form of interaction of the seniors in college or school with the juniors, new entrants or first years. I had heard nasty ragging stories from my seniors.

Fortunately, the college administration had recently adopted very strict policies to stop ragging. All the freshers were put in a different hostel so there was no direct interaction among first year and senior year students. The strange thing about ragging is that once the new guy goes through it, he experiences a change of heart and starts feeling that ragging is justified. Obviously, the senior students didn’t like the idea of banning the ragging. When I asked some of my seniors about their rationale for ragging, they explained that ragging was a great way for new students to open up to seniors. They argued that it increased the solidarity in the student community.

Ragging isn’t something unique in Indian colleges. In western countries, it’s known as ‘hazing’ and practiced in form of initiation rites for student fraternities. Wikipedia defines hazing as the practice of rituals, challenges, and other activities involving harassment, abuse or humiliation used as a way of initiating a person into a group including a new fraternity, sorority, team, or club.

[Read more…] about Behaviouronomics: The IKEA Effect

When you go wrong about something and you feel the spotlight is on you because you blabbered about it in the past, it’s very painful to change your mind even when a significant part of your wealth is at stake.

In a survey, people were asked about their greatest fear. Can you guess what was the number one fear for most people? It wasn’t fear of death.

Fear of public speaking topped the list. Death was second. My guess is that the third one on the list would be a combination i.e. ‘dying while public speaking’. Jokes apart, the act of standing up in front of a crowd and saying something meaningful, for most people, is terrifying.

I remember my first experience. The moment I stood up on the stage, my legs started shaking uncontrollably. Within few seconds my throat went dry as the desert and I was sweating like a pig. I could barely utter a single syllable. I behaved like a deer who suddenly finds itself in front of a hungry and ferocious lion.

The underlying cause of this fear is our intense urge to not look like a stupid. A man would do everything to avoid being in embarrassing situations. This tendency comes from the basic human need to belong to a group, to fit in and not stand out like an odd man out. Social proof is an important behavioural bias which explains why we behave irrationally.

[Read more…] about Behaviouronomics: The Spotlight Effect

Obtaining a new possession often creates a spiral of consumption which leads you to acquire more new things. As a result, we end up buying things that our previous selves never needed to feel happy or fulfilled.

The manager of a superstore came to know that one of his salesmen sold stuff worth Rs 1 crore to a customer on a single day. He got curious and called the salesman in his office.

“How on earth did you manage to sell so much to a single customer?” asked the manager.

“Well, sir, the guy wanted to buy a smartphone so I showed a mobile that could function as a TV remote also. He liked the idea but he didn’t have a TV at home so I sold him a wide screen TV also. Then I suggested to him that a TV without home theatre would be useless so he bought that also. Of course, a wide screen TV and home theatre wouldn’t be of much use without an HD cable connection so he took that too. Then I explained to him how cool it would be to connect his TV to his home security system. He agreed and bought our latest state of the art home security system. The security system came with free gift vouchers. To use those vouchers I took him to our furniture store and he picked up a premium TV cabinet. Since his living room wasn’t big enough for the TV cabinet, we went down to our real estate department and he ended up booking a new house.”

“Wait a minute! So, you’re telling me that you sold a house to a guy who just came in to buy a smartphone?” the manager asked.

“No sir, he just came in asking directions to the nearest bus stop. I told him that if he had a good smartphone, he would never have to ask directions again,” explained the salesman. “And he’s going to come back next week when he moves into his new house since a living room with just a TV cabinet will look quite awkward. Isn’t it?”

[Read more…] about Behaviouronomics: Diderot Effect

Every perception, no matter if you consciously notice, sets off a chain of related ideas in your neural network. It happens to you all the time, and though you are unaware, it changes the way you behave.

Has it happened to you to that you reached home and while turning off the engine of your car/bike you suddenly realized that you can’t recall when you took the turn right before your house? It’s as if you drove the whole way without consciously realizing. It felt as if someone else was driving while you were lost in your own thoughts.

Some call it ‘muscle memory’. Scientists believe that it’s your subconscious that did the driving while your conscious mind was lost in daydreaming and thinking about other things. The autopilot in you was being controlled by your subconscious. We can pull off tremendous feats in spite of being unaware of how we did it. That’s how powerful our subconscious minds are. But with great power comes great vulnerability too. On one hand, our subconscious serves us so well in carrying out the mundane stuff without taxing our brains and requiring our conscious attention, on the other, it is very suggestible too. Which means your subconscious mind absorbs all sorts of information from your surroundings without your permission and realization. And this information that bypasses your conscious attention and enters your mind from a backdoor, can change the way you make decisions and perceive the world around you.

Don’t believe it?

[Read more…] about Behaviouronomics: Priming