Predictably Irrational: The Hidden Forces That Shape Our Decisions
by Dan Ariely
Some years ago, behavioral economist Dan Ariely decided that the overheated market for Duke University basketball tickets might offer an interesting study in human behavior. Every fall, Duke students hoping to buy tickets for the upcoming hoops season camp out for an entire weekend just to get their names in a school-run lottery. They form teams to spread the burden of being stuck in line. As soon as the lottery is held, however, the losers suddenly don’t value the tickets as highly as the winners do. Sure, the have-nots still want to attend the games. But when Ariely discreetly surveyed them about what they’d pay for a ticket, losers offered about $175 on average. The typical winner, by contrast, wouldn’t part with a ticket for less than $2,400.
Ariely, who today is a professor at MIT, doesn’t intend to ridicule our unreliable capacity to set value, said Elizabeth Kolbert in The New Yorker. His new book is an entertaining “taxonomy of financial folly.” But it’s the author’s hope that revealing “the underlying logic of our illogic” will help readers make better decisions about their time and money. Ariely’s “lively and interesting” anecdotes cruelly expose why we’ll pay $100 in a boutique for a scarf that wouldn’t get $10 on the street, said Emily Bobrow in The New York Observer. But he follows with solutions for those who’ve learned to recognize the pitfalls. That makes Predictably Irrational more than just another of the “clever, readable” books that behavioral economists have been writing in the wake of the 2005 hit Freakonomics. Ariely’s contribution is “a self-help book swaddled in empirical data.”
Ariely isn’t afraid to take up “weighty issues,” including the effects of abstinence-only sex education, said Kate Ward in Entertainment Weekly. Unfortunately, he never offers an “overarching theory that can explain why we think the way we do,” said Rosa Cao in the MIT student newspaper The Tech. Readers have to be satisfied with flashes of insight. At one such moment, Ariely explores how each of us can be sheep-like in our tendency to follow the example of our own past behaviors. In another, he shows why sometimes there’s no shame in making economically irrational decisions. Most of us would rather help move a sofa for no payment, for instance, than move it for a low wage.