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Every day we make thousands of decisions, big and small, and behind all of them is a powerful battle in our mind, pitting intuition against logic. This conflict affects every aspect of our life – from what we eat to how we spend your money.
Watch this documentary:
This battle produces mistakes. More precisely, biases (or cognitive biases). In fact, in recent years experimental evidence has documented a series of decision-making flaws that are systematic and predictable that led people astray.
Check out this cool app that tries to make our cognitive biases easy to understand.
In the following video, Rory Sutherland talks about heuristics and biases. Please watch it carefully and reflect.
Please now answer Assignment 2 based on the reading for this lecture and the videos above.
Deadline: Wednesday, September 9, at 15:15.
Suggested answers available here after the deadline.
Please connect to my Zoom (link in Absalon) on Wednesday, September 9 at 15:15.
I will summarize the key ideas of this lecture and I will answer your questions.
After that, you will have time to work online with your group. See below.
Group Work: Brief Description of Context (go to Activity)
To start the Activity, each group receives a brief description of a specific problem (here).
First, reflect on the problem with your group (why this is important? What are its causes? What are the expected consequences?). Write the essence and the boundaries of your problem. Provide also some “numbers” to explain why this problem is important for society.
Second, give a brief description of the context in which the intervention is going to happen. Include ‘when’ and ‘where’ the intervention will happen and ‘who is the target agent’. Describe at what level (individual, family, neighborhood,…) you should address the target behavior.
Note: interventions usually target those people that will directly benefit from the intervention. However, that is not always the case (e.g. kids may benefit of a health intervention, but to achieve that we have to target their parents).
Together with your group, fill the corresponding cell of this Google Spreadsheet. Deadline: before the next lecture.
Summary for this lecture:
- Behavioral economists pointed out specific quirks or anomalies in our decision-making processes, systematic and predictable errors that sometimes prevent us from reaching our true goals.
- The deviations from the standard model —or cognitive biases— are broad tendencies, rather than fixed traits: biases are not uniformly shared by everyone, and the context can play a major role in how strongly a bias influences our behavior.
- Understanding biases can generate more accurate explanations and predictions of the choices that individuals, groups, firms and institutions make.
- Once we understand how cognitive biases are contributing to our poor decision making, we can start mitigating those biases and improving our judgments.
To know more:
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