January Read/2

Title: The Art of Thinking Clearly

Author: Dobelli, Rolf

Call Number: 153.42 D633K 2013

Subjects: Reasoning; Errors; Psychological Aspects; Decision Making; Cognition

ISBN: 9780062219688

Number of Pages: 358

Book Description (from Inside of the Book Cover):

            Have you ever…Invested time in something that, in hindsight, just wasn’t worth it?

Paid too much in an eBay auction? Continued to do something you knew was bad for you? Sold stocks too late, or too early? Taken credit for success, but blamed failure on external circumstances? Backed the wrong horse?

            These are examples of what the author calls cognitive biases, simple errors all of us make in day-to-day thinking. But by knowing what they are and how to identify them, we can avoid them and make better choices: whether in dealing with personal problems or business negotiations, trying to save money or earn profits, or merely working out what we really want in life-and strategizing the best way to get it.

            Already an international bestseller, The Art of Thinking Clearly distills cutting-edge research from behavioral economics, psychology, and neuroscience into a clever, practical guide for anyone who’s ever wanted to be wiser and make better decisions. A novelist, thinker, and entrepreneur, Rolf Dobelli deftly shows that in order to lead happier, more prospective lives, we don’t need extra cunning, new ideas, shiny gadgets, or more frantic hyperactivity-all we need is less irrationality.

            Simple, clear, and always surprising this indispensable book will change the way you think and transform your decision making-at work, at home, every day. From why you shouldn’t accept a free drink to why you should walk out of a movie you don’t like, from why it’s so hard to predict the future to why you shouldn’t watch the news, The Art of Thinking Clearly helps solve the puzzle of human reasoning.

My Read:

            This book is a collection of thinking and cognitive thinking errors. Each There are ninety nine short chapters in this thinking provocative book. Each chapter starts with a title followed by a subtitle describing a thinking bias people might fall into trap. The followings are some examples I find interesting and so true reflecting the reality our daily life presents.

46-Be Careful What You Wish For: Hedonic Treadmill (page 137-page 139)

            “Suppose one day the phone rings: An excited voice tells you that you have just scooped the lottery jackpot-$10 million! How would you feel? And how long would you feel like that? Another scenario: The phone rings, and you learn that your best friend has passed away. Again, how would you feel, and for how long?”

            In the following paragraph, there is this study done by Harvard psychologist Dan Gilbert answered the question for us. He has studies lottery winners and discovered that the happiness effect fizzles out after a few months. So, a little while after you receive the big check, you will be as content or as discontent as you were before. He calls this “affective forecasting”: our inability to correctly predict our own emotions (page 137).

            I find it so true as I closed the book and pondered upon what the message meant. At the time I owned my first bicycle I would wake up pretty early in the winter morning to ride my dream green bike. As time passed the bike simply became a mean of transportation. The excitement and joy owning a new “toy” faded away, like the dust finally touched the ground and stayed where it landed. Emotion rides come and go as our life bustles and settles. 
            At the end, the author recommends the followings: Follow your passions even if you must forfeit a portion of your income for them. Invest in friendships. For most people, professional status achieves long-lasting happiness, as long as they don't change peer groups at the same time. In other words, if you ascend to a CEO role and fraternize only with other executives, the effect fizzles out(page 139).

33-Why Teams Are Lazy: Social Loafing (page 98-page 100)

            The social loafing effect occurs when individual performance is not directly visible; it blends into the group effort. Why invest all of your energy when half will do-especially when this little shortcut goes unnoticed? Quite simply, social loafing is a form of cheating of which we are all guilty even if it takes the place unconsciously. When people work together, individual performances decrease. Evolution has led us to develop many fine-tuned senses, including how much idleness we can get away with and how to recognize it in others (page 98 –page 99).

            Then one question remains: Who came up with the much vaunted idea that teams achieve more than individual workers? Maybe the Japanese. The author reasons what worked very well in Japan could not be replicated with the Americans-perhaps because social loafing rarely happens there. In the West, teams function better if and only if they are small and consist of diverse, specialized people. This makes sense, because within such groups, individual performances can be traced back to each specialist (page 99).

            As I read this chapter, I couldn’t help but agree with the statement the author states. Efficient and effective teamwork is a goal I have been pursuing and wondering if I could ever achieve it to meet my expectations. Reading this chapter reminds me of a conversation I had regarding to individualist vs teamwork and team spirit. People admire and respect heroes. At the same time, no matter how small a group is, a successful mission is completed by the effort and time the team has made. Contributions and efforts might be made imbalanced and not everyone was at the same page. On the surface what people see is the success of a team; in reality people might have no clue how the team became successful.  
75-How to Profit from the Implausible: The Black Swan (page 224 -page 226)
            "Black Swan" is a symbol of the improbable; a black swan is an unthinkable event that massively affects your life, your career, your company, your country. But there are positive and negative Black Swans (page 224). In this chapter the author tells about breakthrough, the kind you can increase your income by a fraction of ten thousand and the kind of black swans like Facebook. At the end of the chapter the author suggests that we should avoid surroundings where negative Black Swans thrive. This means: Stay out of debt, invest your savings as conservatively as possible, and get used to a modest standard of living-no matter whether your big breakthrough comes or not. (page 226)

            At the end the author suggests that if a person is in her/his “circle of competence” (in the field s/he intuitively understands and masters) s/he could let her/his intuition take the lead. If one person faces a consequential decision outside the circle of competence, apply the hard, slow, rational thinking. For everything else, give your intuition free rein (page 306). This conclusion and suggestion concur with the scientific finding that we are habit creatures.