The one-sentence summary

You can make better choices by understanding the cognitive biases to which we all succumb.

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WHAT THE BOOK SAYS 

  • Cognitive biases cause simple errors in most of our day-to-day thinking.
  • Understanding these can help when dealing with personal problems, negotiating in business, trying to save or make money.
  • There are 99 examples here – too many to summarise – so here are some examples:
    • Social proof: if lots of other people do something foolish, so do we.
    • Sunk cost fallacy: investment or ownership warps our estimate of value.
    • Confirmation bias: we use as evidence what we want to see.
    • Story bias: a good narrative makes us fall for things.
    • Illusion of control: you control less than you think.
    • Paradox of choice: the more choice we have, the less we make a decision.
    • Coincidence: there is an inevitably about unlikely events.
    • Gambler’s fallacy: there is no balancing force of the universe.
    • Winner’s curse: curb your enthusiasm because your ‘luck’ will change.
    • Loss aversion: bad events strike harder than good ones.
    • Hedonic treadmill: be careful what you wish for – it’s never that satisfying when you get there.
    • Affect heuristic: you are a slave to your emotions and always make shortcuts.
    • Sleeper effect: propaganda works because over time we forget where we heard something.

WHAT’S GOOD ABOUT IT

  • This is an excellent synthesis of all matters relating to behavioural economics – arguably all in one place for the first time.
  • 99 concepts are covered in bite size chunks of no greater than 1,000 words, so you can get the gist fast.
  • They are all cross-referenced, so you can interlink theories and ideas.

WHAT YOU HAVE TO WATCH

  • The examples can get a bit repetitive, with a large number drawn from finance.
  • As ever, even recognising these things may not allow you to ride against your instincts – something the author freely admits.