WHAT IS STRATEGIC MISREPRESENTATION AND HOT AIR Suppose you apply for your dream job. You buff your resumé to a shine. In the job interview, you highlight your achievements and abilities and gloss over weak points and setbacks. When they ask if you could boost sales by 30% while cutting… Read More »What is Strategic Misrepresentation?
WHAT IS ILLUSION OF ATTENTION AND WHY YOU HAVE NO IDEA WHAT YOU ARE OVERLOOKING After heavy rains in the south of England, a river in a small village overflowed its banks. The police closed the ford, the shallow part of the river where vehicles cross, and diverted traffic. The… Read More »What is Illusion of Attention?
WHAT IS PERSONIFICATION AND WHY YOU PREFER NOVELS TO STATISTICS For eighteen years, the American media was prohibited from showing photographs of fallen soldiers’ coffins. In February 2009, defence secretary Robert Gates lifted this ban and images flooded on to the Internet. Officially, family members have to give their approval… Read More »What is Personification?
What is Envy? And why you should build your own castle Three scenarios – which would irk you the most? A) Your friends’ salaries increase. Yours stays the same. B) Their salaries stay the same. Yours too. C) Their average salaries are cut. Yours is, too. If you answered A,… Read More »What is Envy?
WHAT IS PROCRASTINATION AND WHY NEW YEAR’S RESOLUTIONS DON’T WORK A friend, a writer, someone who knows how to capture emotion in sentences – let’s call him an artist – writes modest books of about 100 pages every seven years. His output is the equivalent of two lines of print… Read More »What is Procrastination?
What is House-Money Effect? And why money is not naked A windy fall day in the early 1980s. The wet leaves swirled about the sidewalk. Pushing my bike up the hill to school, I noticed a strange leaf at my feet. It was big and rust-brown, and only when I… Read More »What is House-Money Effect?
What is Salience Effect? And how eye-catching details render us blind The salience bias describes our tendency to focus on items or information that are more noteworthy while ignoring those that do not grab our attention. Here’s an example Imagine the issue of marijuana has been dominating the media for… Read More »What is Salience Effect?
What is Fear of Regret? And why ‘last chances’ make us panic Consider the following two stories: First Story Paul owns shares in company A. During the year, he considered selling them and buying shares in company B. In the end, he didn’t. Today he knows that if he had… Read More »What is Fear of Regret?
A video explaining Default Effect by Rolf Dobelli the author of The Art of Thinking Clearly on the IDFC Mutual Fund Youtube Channel. What is Default Effect? And why you go with the status quo In a restaurant the other day I scanned the wine list in desperation. Irouléguy? Harslevelü?… Read More »What is Default Effect?
What is Ambiguity Aversion? And the difference between risk and uncertainty Ambiguity aversion, or uncertainty aversion, is the tendency to favor the known over the unknown, including known risks over unknown risks. Here’s an example Two boxes. Box A contains 100 balls: 50 red and 50 black. Box B also… Read More »What is Ambiguity Aversion?
