- How much I’d Recommend: 9/10
- Date finished: 2/1/20
- Predictably Irrational: recommend borrowing from your local library – everyone should read it at least once!
This book is fascinating on describing some of the very basic decisions we make, that we think we are being rational, when we are not.
- We are always looking at the things around us in relation to others.
- The only cure is to break the cycle of relativity.
- In order to make a man covet a thing, it’s only necessary to make the thing difficult to attain
On free stuff:
- Free is not always the best deal: not “free.” This also applies for time: go to the museum on the day it is free.
- the difference between two cents & one cent is small, but the difference between one cent and free is HUGE.
The cost of social norms:
- the most expensive sex is free sex!
- Social norms vs. market norms
- Introducing market norms into social exchange violates the social norm & hurts the relationship. Once this type of mistake has been committed, recovering a social relationship is difficult.
- Companies undermining the social contract between employers & employees and replacing it with market norms. It is really no surprise that “corporate loyalty” in terms of the loyalty of employees to their companies, has became an oxymoron.
- Money, as it turns out, is very often the most expensive way to motivate people. Social norms are not only cheaper, but often move effective as well.
The influence of emotions:
- Our emotions change who we are when we are in a heated moment. Morality ethics goes out of the window.
- Moral to the story, don’t make decisions or drive when you are in a high emotional state, and don’t underestimate the influence of emotions that could cloud your judgment.
- What we truly need is a method to curb our consumption at the moment of temptation, rather than a way to explain about it after the fact.
- The high price of ownership: when we own something – whether it is a car or a violin – we begin to value it more than other people do.
- Pride of ownership is inversely proportional to the ease with which one assembles the furniture.
- Virtual ownership: we become partial owners even before we own anything, e.g. auction, catalog, trial promotion, 30-day money back guarantee, ideas of politics & sport teams
- Everywhere we see the temptation to improve the quality of our lives by buying a larger home, a second car, a new dishwasher, a lawn mower, and so on. Once we change our possessions we have a very hard time going back down.
- View all transactions as if I were a non-owner, putting some distance between myself and the item of interest
The cost of options
- We keep our options open at costs we don’t know: just in case
- The consequence of not deciding sometimes is larger: trying to compare two job opportunities and losing sleep over finding apartments in a different location, rather than picking one choice and move on with my life. We are afraid of picking the “wrong choice” or “burn bridges” or setting off on a road we cannot turn back. The truth is, it’s a lot easier to make a decision and keep going on it.
The effect of expectation: if you tell people up front that something might be disastrous, odds are good they will agree with you – not because of their experience, but their expectations.