The Art of Thinking Clearly (TAoTC)

The Art of Thinking Clearly Book by Rolf Dobelli

The Art of Thinking Clearly is a 2013 book by the Swiss writer Rolf Dobelli which describes in short chapters 99 of the most common thinking errors – ranging from cognitive biases to envy and social distortions.

In December 2017, while wandering around Changi Airport, I visited a WH Smith bookshop. There, I picked up and read the cover of "The Art of Thinking Clearly" (TAoTC). Instantly, I knew it would offer rich language, vocabulary, analogies, and anecdotes to ease my daily decision-making debates. After purchasing it, the book introduced me to numerous valuable resources I now follow. Cognitive Biases, Simple Errors

Smart, creative and intelligent people think a lot. Yet they are also fallible to cognitive dissonance, behavioral biases and prejudices. Humans are normally gullible and credulous, no one of us can deny falling prey to reasoning errors or flaws in the reasoning. Humans are fallible and susceptible to making errors, unless they learn to be critical and careful in making sound arguments.

#1 Survivorship bias

We are more irrational than we think. We tend to overestimate our chances of success, while underestimating chances of failure. We like to listen to stories of triumph, because history celebrates success more than mourning failure. Anytime when you might overestimate your own abilities and strengths, just pay a visit to graveyards and cemeteries. You have more to thank the environment than taking credit all to your own.

#2 Swimmer’s body illusion

This is an epitome of confusing cause and correlation. Athletes have a good physique because they do sports everyday. Athletes do sports because they have good genes and physique. Whichever line of reasoning you espouse, do not disregard the accumulative effects of daily training on the mind and physical health.

#3 Clustering illusion

We are skilled and talented in pattern recognition. Comparatively, artificial intelligence might find it difficult to do so without computation and machine learning. For instance we find it easy to spot faces in cumulonimbus clouds and recognize patterns of constellations in the August night sky.

#4 Social proof

Bubbles and stock market panic are triggered by communal fear and herd instinct. Peer pressure can distort common sense.

#5 Sunk cost fallacy

It is easy to fall prey to sunk cost fallacy by putting in more time, effort and money to retrieve something out of a wasted situation. A meaningless project with non-recoverable investments will only do more harm than good if we delay putting a full-stop to its end.

#6 Reciprocity

Reciprocity is the central core of cooperation among people that sustains economy growth and social development. The act of reciprocity are employed by Non-Governmental Organizations (NGOs) and philanthropic organizations that give first, take later. If you want to avoid accumulating free samples and gifts which you don’t necessarily need, don’t accept free food and drinks in the supermarket aisle.

#7 Confirmation bias

Confirmation bias helps us interpret new information so that it is readily compatible with our existing beliefs and mental models. However we are often quick to dismiss or neglect nonconforming evidence.

We interpret and process incoming information to make it fit perfectly with our existing beliefs and thinking models. Therefore writers and journalists have to trim away redundant words and filter contradicting ideas so that the carefully interwoven piece of essay does not bore readers to banality. Certain predictions of future trends in the trade and stock markets are vague enough that there is a 99% chance of it becoming true. Astrologists and economists might be susceptible to this flaw too.

#10 Contrast effect

We make stark and obvious comparisons to ascertain values of objects. We compare apples and oranges by the mass or quality of the fruit. We face difficulty in making absolute judgments that we have to rely on relative comparison. Students learn english faster through antonyms and synonyms.

#14 Hindsight bias

Keep a personal journal along with you as you traverse the journey of life. As you write down your predictions for the future, you could prevent hindsight bias by comparing your jotted notes with actual developments in real life. Study history from the recorded documents and historical accounts as well. Read newspapers from five or ten years ago to overcome hindsight.

#16 Chauffeur Knowledge

Don't Take News Anchors Seriously. Be on the lookout for chauffeur knowledge. Do not confuse the company spokesperson, the ringmaster, the newscaster, the schmoozer, the verbiage vender or the cliche generator with those who possess true knowledge. How do you recognise the difference? There is a clear indicator: true experts recognise the limits of what they know and what they do not know. If they find themselves outside their circle of competence, they keep quiet or simply say, Í don't know.'This they utter unapologetically, even with a certain pride. From chauffeurs, we hear every line except this.

#20 Outcome bias

Never judge a decision based on its results since there are external factors of randomness and chaos at play. Let go of the outcome after you have examined the reasoning by asking yourself “was it rational, logical and justifiable?”

#23 Endowment effect

Psychologist Dan Ariely once asked students to estimate how much the tickets to a basketball game might cost. Some students were given tickets, while the rest were not given anything. Barehanded students estimated around a hundred bucks, while students holding tickets overestimated the price to a few thousand bucks per ticket. Endowment effects also affects the bidding process in auction, judgement, possession, ownership and business acquisition.

#25 Group think effect

The calamity of conformity is one of the most palpable social biases. People working in groups or herds might loathe action and love inactivity, as long as it does not disrupt the status quo. Herd effect trains a close-knit group to cultivate team spirit, but an excess of group think effect would make people lose their individuality and free will.

As they work with disillusionment in support of unanimity, there would be no tolerance of any dissenting or diverging viewpoint. Speak your mind and question the assumptions even if it is the inconvenient truth, so that your voice will be heard.

#28 Base-rate neglect

In medicinal field, migraines and headaches can be indicative of a viral infection or brain tumor. Viral infections have a higher likelihood to occur as they have a higher base rate. Medical school students are trained to default to statistical thinking. That is, by investigating the most frequently occurring ailments before diagnosing any other rarer debilitating diseases.

Dobelli advised elite students in business school to take into account of base rate when they envisioning and planning their future. Whenever prompted, business school students would view themselves as “future bosses of the world’s top 100 global companies.”

Dobelli reminds us that statistically there would be only less than 0.1 percent chance of landing a spot on the board of a Fortune 500 company.

#36 Fundamental attribution error

Never ask a writer if the novel is autobiographical. History is subjected to constant revision, amendments, addition and omission throughout the years. People tend to overestimate one historical figure’s influence and control, while underestimating external environmental factors that could fundamentally alter the geopolitical circumstances.

#41 Conjunction fallacy

If you were asked to evaluate two statements and rate the likelihood of occurrence, which forecast would you choose to identify strongly? “A. Natural gas consumption will decrease by 20 percent next year” versus “B. The skyrocketing price of natural gas will lead to a decrease in gas consumption next year.” More people would choose statement B since it triggers intuitive, automatic thinking that outweighs slow, conscious thinking. Plausible stories with convenient details are much more convincing (and frightening).

#43 Action bias

Watching and waiting is torture when you can instead do something in emergency situations such as fire drill. Differentiate reaction from response in certain life-saving and uncertain turbulent circumstances. Watch-and-wait for another minute could be fatal. Contemplation is laudable but taking action is very much necessary to reduce casualties and ensure survival.

#49 Beginner’s luck

Be cautious and wary when things start off to a meteoric rise, for which it can be easily mistaken as the beginner’s luck. A beginner might want to multiply his odds of winning the game by attempting more bets. Triumph is made ostensibly visible than failure, thus we tend to double down on our bets of success.

If in ten years’ time, you could establish yourself as an expert in the field, it will indicate talent and effort.

#53 Decision fatigue

Psychologist Roy Baumeister and Jean Twenge once conducted an experiment by letting two groups of students choose what they could take home. The first group “decider” was asked to make decisions on the spot every time two random items are presented. The second group “non-decider” was asked to write down their perception of each item, and the Baumeister would decide for them what they could take back.

In the next test, the two groups of students had to put their hands in ice water and hold for as long as possible. The longer the time one holds his hands under ice water, the greater self-discipline and willpower one exerts on himself. It turns out that “deciders” pulled their hands out sooner than “non-deciders”.

#59 Information bias

If you have a competitor, feed him information. Doctors, managers, investors are overfed with trivial information and data, which not only wastes time, attention, energy and effort, but also makes the problem seem more unintelligible.

There is no use trying to gather all data because decisions based on cold, bare facts would work out just as fine.

#73 Primacy and recency effects

First impressions can be deceiving. During recruitment, the employer might hire the person who gives the best impression due to primacy effect.

The more recent we are given the information, the better we can recall and retrieve it from memory. For instance, you might still remember the breakfast you ate yesterday better than the last tv episode you watched a few months ago.

Primacy effect supplants recency effects where first impressions prevails such as job recruitment, exam grading, meeting etc. It’s not always that hello and goodbye counts because of outcome bias, but also the process that will create a lasting impression on people.

#82 Fear of regret

Regret can be summed up as a mix of sadness, remorse, repentance and disappointment towards oneself. The contrite feeling is the same as ranting “how I wished I could have done [this and that] when I was younger” when you walk down the memory lanes of the last ten years.

Each year on December 31, traders and marketers sell off their more expensive and exotic stocks with bargain prices because that day will be the last day of the year. We would choose to grab this last chance offer to avoid the fear of regret.

#85 Procrastination

New year’s resolutions work to a certain extent, unless you ruefully decide procrastination is a cardinal sin. Dobelli’s neighbor wrote her doctoral thesis in merely three months in a tiny cabin she rented elsewhere. She immersed herself in purely writing without getting interrupted by telephone rings or email pings. She even called her friends to make a bet on the deadlines so that her personal due dates are now considered solid-rock commitments.

#91 Planning fallacy

This takes us back to the #1 survivorship bias. We can say everything in hindsight could have been done better. We can look to the future and overcommit ourselves to goals that haven’t yet actualized and realized in our realm of perception. We could never predict up to minutes and seconds when would be that point of inflection.

Psychologist Gary Klein suggested a cure to prevent overthinking, overworking and overloading yourself with worries that are not emergent yet. I would give it an opportunistic and optimistic twist:

Imagine it is six months from today. We have followed the plan as written on a pledge. It is a wish fulfilled in a perfect and sensible manner.

What is the mental roadblocks that you foresee could have hindered you along the way, but you somehow took a comical bent at the right place, such that you could arrive at this point to laugh at your doubts and misgivings?

What would you see, hear, feel, and say to yourself?

To make the feeling more appreciative, add your friends and family who have been cheering for you all along the journey. While only a snippet of an imagined future, this situation would tell you exactly how things might unfold in the next few months. Learn from past mistakes to avoid committing the planning fallacy. Give yourself a pat on the back: whatever I could think of, I would have considered it earlier. Everything else shall come to pass.

This is a review of The Art of Thinking Clearly by Rolf Dobelli. Originally published at showdeyang.com

https://medium.com/@showdelin/the-art-of-thinking-clearly-9ab15222b1ea