Gurus of the Irrational


We have been discussing the work of Daniel Kahneman and Amos Tversky. In the words of Michael Lewis, they demonstrated that people, including experts of every kind, “unwittingly use all sorts of irrelevant criteria in decision-making.” One of those fallacious criteria is cognitive bias, which is so insidious because it is largely unconscious.

Lewis lists several of the research team’s examples of how thinking goes astray. The examples are reminiscent of a certain genre of riddle that has been a cultural feature for decades. For example:

A window cleaner is cleaning the windows on the 25th floor of a skyscraper. He slips and falls. He is not wearing a safety harness and nothing slows his fall, yet he suffers no injuries. Explain.

Answer: The window cleaner is cleaning the inside windows.

It’s not a trick question, but it could baffle someone whose cognitive bias brings up a mental picture of a window cleaner situated on a suspended platform outside a building. As long as a person is oblivious to the alternative possibility, that the cleaner could be working on the inner side of the glass, the riddle will not be solved. To entertain the cognitive illusion that window washers can only be in one place — outside — is to blind oneself to reality and guarantee that the answer will not be found.

Kahneman and Tversky also identified a logical error they called the conjunction fallacy, which is too complicated to go into here; and developed a school of thought around decision-making. Lewis says:

In their most cited paper, cryptically titled “Prospect Theory,” they convinced a lot of people that human beings are best understood as being risk-averse when making a decision that offers hope of a gain but risk-seeking when making a decision that will lead to a certain loss.

Dylan Matthews describes the work of Richard Thaler, another behavioral economist who proves that humans are not rational in their decision-making. He took an interest in “identifying specific kinds of irrationality that could be predicted and modeled ahead of time.”

Thaler described the peculiar mental accounting by which a person decides how to spend or save, depending on where the money comes from. Then, there is the endowment effect:

The basic idea is that people are strongly averse to giving up goods they already have, to the point of refusing to sell the goods for a price higher than what they paid for the goods to start with.

The endowment effect is closely related to loss aversion — the finding that people try harder to avoid losses, and put forth less of an effort to pursue gains. Writer Carl Richards phrased the concept like this:

We feel the pain of loss more acutely than we feel the pleasure of gain. In other words, we may like to win, but we hate to lose.

Childhood Obesity News has brought this up before in relation to the Fear of Missing Out (FOMO) syndrome. First, admittedly it is rational to miss something we once had, and that we lost. But the other face of FOMO is people getting all bent out of shape over missing stuff they never had. FOMO fever gets out of control and drives bad decisions. If you stop and think about it, it is pretty unreasonable to miss something we never had in the first place.

The weirdness

Paradoxically, this is exactly what we encourage an obese child to do. We hope the young person will feel desire for something he or she has never known: the pleasure of living in a fit, agile, non-obese physical frame. More importantly, we want them to abandon all the survival skills and coping mechanisms they have learned over the years. They know that sweets heal emotional pain. They know that binge eating fills up the emptiness. These are the pillars of truth on which the universe rests.

And then… there is pressure to change everything. Imagine if someone comes to you with a fabulous plan for living on the moon. “You’ll love it,” they gush. “You’ll be a whole new person!” But the person you are has already put in a lot of hard work figuring out how to make it in the Terran environment. You know how to breathe Earth’s air and walk around in Earth’s gravity. For these and other reasons, the moon colony will probably be a hard sell.

We want to maintain the status quo. As the old saying goes, “Better the devil you know than the devil you don’t.” Richards says:

The endowment effect is so powerful, people value their existing level of health so much, that they’d pay 50 times more to preserve their current level of health than to get a little healthier.

It has been an ongoing mystery, why many kids admit to several horrendous varieties of misery, and yet seem so unwilling to work for change. Is it possible that an obese teenager would pay 50 times more to preserve her current level of health than to get a little healthier? What an absurd idea — yet apparently, the endowment effect is a powerful force working against the efforts to help teens get healthy.

Your responses and feedback are welcome!

Source: “The King of Human Error,”, December 2011
Source: “10 Smart Riddles,”, undated
Source: “This headline is a nudge to get you to read about Nobel economist Richard Thaler,”, 10/09/17
Source: “Overcoming an Aversion to Loss,”, 12/09/13
Photo credit: darkday via Visualhunt/CC BY

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