2022-02-15 ~4 min read

Thinking Fast and Slow

Thinking fast and slow

Part 1: The Two Systems and Part 2: Heuristics and Biases

Part 1 and part 2 of the book introduces us to both the systems of our mind.
System 1 operates quickly and automatically with little or no voluntary control and can not be turned off. It is impulsive and has biases.
While System 2 requires attention and effort. One of the tasks of System 2 is to overcome the impulses of System 1.
To get a sense of both of these system works, consider this: What is 34x23? - System 1 will be able to quickly reject answers like 10, 9000, etc. - System 2 will be required to solve this and it will require a certain amount of effort.
System 2 is lazy. Until we call upon our System 2, it will accept the judgments passed by System 1. This means that we can learn to recognize the situations in which mistakes are likely and try harder to avoid significant mistakes when stakes are high.
Intense Focusing: (like the calculation stated above) requires mental work (effort). It can sometimes make us blind to obvious stimuli. We have a limited budget of effort (maintained by system 2). For fun, try this. However, as you become skilled in a task, its demand for energy diminishes.
Ego depletion: Effort of will or self-control takes a toll on the same budget of effort. This means that after exerting self-control in one task (which requires System 2) you do not feel like making an effort in another. A quote regarding ego depletion from the book: “His ego was depleted after a long day of meetings. So he just turned to standard operating procedures instead of thinking through the problems”.
Our system 1 makes association continuously between different (sometimes unrelated) things. It also makes quick causal inferences (right or wrong). For fun, look at this. If you watched the video completely, you might have formed an image that larger triangle was a bully even though nothing was mentioned.
The most important concept of the first part of the book is that System 1 often tries to answer an easier question then what is actually asked. - For example, to answer this question, “How happy are you with your life these days?” you might end up answering the question of “What is my mood right now?”.
Anchors: Answer this question: Was Gandhi 121 years old when he died? and now answer this question: What was the age of Gandhi when he died?. Your answer to the second question might be affected by the number 121 presented in the first question. You adjust to the provided anchor and you only adjust until you are no longer sure you should go further. This has a very strong impact on negotiations and persuasions.
Availability bias: The ease with which you can recall examples of one thing can impact your decision. Example: If there was a plane crash near your city in recent times and you remember it, you might avoid flying the plane even though the overall risk is just the same.
If a lot of detail is given to us about a situation, we tend to give it more weightage of being true rather than if we are given fewer details about it. Try this exercise.

Part 3: Overconfidence and Part 4: Choices

We tend to think that our past makes sense and we knew about it all along. This is a fallacy, as sometimes we make sense of the past only after it was known to be true.
Directly taken from the book: “Once you adopt a new view of the world (or any part of it), you immediately lose much of your ability to recall what you used to believe before your mindset changed.”
This has a very worrisome effect that once a person thinks he knew the past as it was happening, he assumes that he can also control the future.
Structured yet simple formulas are sometimes better than human intuitions and can help us to make better decisions.
When we are in bad gambles where a sure loss is guaranteed we are likely to be risk-seeking.
The psychological value of losses is much more than the psychological value of gains of the same amount.
Lowe probability events are much more heavily weighted when defined in terms of frequency rather than probability. This leads us to sometimes overweight unfavorable outcomes more than required which leads to bad decisions.
People have a stronger reaction (regret) to an outcome that was produced by action rather than to the same outcome when it is produced by inaction.

Part 5: Two Selves

This part takes a different approach then system 1 and system 2. It talks about experiencing self and a remembering self.
When people judge any activity that requires recollecting memory we usually tend to answer the question: What was the peak (good/bad) experience and what was the experience towards the end?. Sometimes we neglect what was the duration of the whole activity.
This may result in judging an activity badly just by its ending (like the TV series GoT), and neglecting the enjoyment we got from the activity over the whole duration.
The points mentioned above are a shortcoming of remembering self. Whenever we refer to our memories, our remembering self which creates a narrative of the past experiences responds. The experiencing self which has the knowledge of how the activity went does not have a say.
In short, remembering self ignores time as a finite resource.
Focusing illusion: I create a bias in favor of goods and experiences that are initially exciting, even if they will eventually lose their appeal.