Cognitive illusion and decisionmaking from "summary" of Misbehaving by Richard H Thaler
Cognitive illusions can have a big impact on decision making, leading us to certain conclusions even when evidence may point in a different direction. Our perception of the world around us can be distorted by our own thoughts and experiences, making it difficult to make the best decisions.- People often believe that decisions they make will never bring failure even if the outcome is not expected. This cognitive illusion keeps them away from objectively evaluating their decisions and taking incorrect ones even when there are signs of trouble coming up.
- It has been observed that human judgment regarding decisions does not remain consistent, particularly if it’s made under pressure or if two conflicting goals are presented. Hence, one must be careful about relying too heavily on intuition when making decisions at an individual level.
- The psychological effect of repeated success or failure of any particular decision cannot be underestimated either. People have a tendency to let past successes or failures affect their future choices, which can cloud their judgment and sway the opinion towards a particular option.
- Perception towards an issue at hand might considerably vary according to differences in culture or social values held by different groups in a society. Even minor nuances can lead to vast differences in every day decision-making ability and processes imeded thereby.
- In situations where tackling multiple challenges simultaneously is impossible, we may use shortcuts to simplify our decision-making process. However, these can result in incorrect results and poor execution, so it’s important to consider all possible solutions carefully.
